Hi Lisa

Income is all about stability. I'm from Michigan so I know the pain the region is feeling with unemployment.

With that being said, if your year-to-date income is not up to previous years it normally requires an explanation. The lender needs to determine whether being laid off is/was a temporary isolated incident or if it is likely to continue. They need to guage not only your willingness to make the payment but your ability going forward. And unfortunately layoffs are a sign of the times right now.

You can't use unemployment income to qualify normally, unless there is a documented 2 year track record of stability. And as far as DTI requirements, these can vary depending on the type of loan and the lender.

For example, conforming loans with less than 20% down payment or equity , since they require PMI are capped at a 41% debt to income ratio not by lenders but by the PMI companies who recently have tightened their guidelines.

I'd recommend seeing if your husband's employer can write a letter explaining that his layoff was isolated and that he is back to work full time and is expected to remain fully employed going forward (if that is in fact the case). If not, then you can check with other lenders but be prepared that you may get the same type of answer.

Best of luck
Tony

Lisa,
Bank of America has tight debt ratio restrictions. Even if you are approved, they can and will turn it down based on debt ratio, even if it appears to be "fine".
I have lenders that will approve a loan up to a 58% back end ratio as well as take a "common sense" approach.
Feel free to call me or apply online.

Josh Stewart
Preferred Mortgage Consultants
1-800-839-1019 ext 135

Lisa,

Not all lenders are the same, however they all have to abide by State & Federal Lending Regulations and Practices. With that being said...My best advice to give you is to go to a local lender. Bank of America, while a good bank in there of itself, is not local to the area so they have no idea what is really going on here in Bowling Green. If you are working is a Realtor ask them for advise on which lender you should talk to...as a local Realtor in the Bowling Green area I can suggest some very good lenders with great customer service practices. We have an inhouse lender that is great to work with and can get the job done with very little hassle and headaches.

Lisa, do not assume that all bank are the same. Just because one bank approves/declines, does not mean that all will. Though I cannot directly answer your question, I can tell you this; shop around. Visit many banks and lenders. Try to do it all within a 14 day period as that will be less likely to negatively impact your credit score. If you are working with a Realtor, ask them for assistance.

Best wishes!

Todd