Home Buying in Levittown>Question Details

homebuyer, Home Buyer in Bucks County, PA

Do lenders take into account job stability when applying for a mortgage?

Asked by homebuyer, Bucks County, PA Mon Sep 28, 2009

I have been working on repairing my credit and I will be at point in the next month or so to start working towards getting a pre-approval. My credit score will still be mid 600's which is fairly low. So I'm wondering if having an extremely extremely secure job will help get approved/better terms.

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Thanks for your input Cynthia,

I changed jobs last October as a result of finishing school, but I'm working for the most secure employer there is. Any idea how that will affect me? As far as the ratio's, from my calculations I believe I should have fairly low ratios since the only debt I currently have are student loans and my car payment. My wife has only a car payment. I am trying to be as prepared as possible before I speak with a mortgage broker so as not to waste anyone's time.
1 vote Thank Flag Link Mon Sep 28, 2009
Talk to a mortgage lender soon as there are going to be changes to the FHA program. You should also go to http://www.hud.gov as there are many resources for buyers including information about credit scores and financing. If you would like a homebuyers handbook let me know.
Web Reference: http://www.gitabantwal.com
0 votes Thank Flag Link Fri Feb 5, 2010
If you credit score is in the mid 600's, meaning 650 not 605, and you can qualify based on income, assets, and debt ratio, you should not have a problem getting an FHA loan. If you have a good job history, no gaps in employment, that's a plus, but the big thing is what I call the CIA of mortgages, Credit, Income and Assets.
0 votes Thank Flag Link Mon Sep 28, 2009
I believe that they may take into consideration job stability, but you would be better off talking to a mortgage broker.
0 votes Thank Flag Link Mon Sep 28, 2009
Chris - Your welcome. In terms of ratios, there are two ratios that are used to determine affordability. One is the Housing Expense Ratio (includes all mortgage, principal & interest, property taxes, homeowners insurance and if applicable PMI (private mortgage insurance).The other is Total Expense Ratio (includes all housing expenses plus the monthly payments of any other obligations ie; student loans, revolving charge cards, child support, etc.) If you would like me to refer you to a lender who would help you determine where you stand in terms of getting approved, let me know. There is no obligation to do so. I can also mail you a HomeBuyers workbook that will further explain and help you to track your progress and prepare you for applying for a mortgage loan. if you would like a copy of the workbook, to protect your privacy; you can email me your mailing address at: ccortes@remax.net and I'll get a copy out to you.
Cynthia Cortes
Realtor/Partner
Remax Properties, Ltd.
210 Penns Trail, Suite 100
Newtown, PA 18940
Office: 215-968-7494
Cell: 215-801-9315
0 votes Thank Flag Link Mon Sep 28, 2009
Hi Chris - A secure job will certainly help as you will provide your lender with at least 2 years of reported income (W-2's) that has been filed to the IRS. You should also have a satisfactory history of paying your loans and charge accounts on time. You must qualify for the loan in terms of your income as it relates to out standing monthly obligations. Your lender will calculate the percentage of gross monthly income required for monthly mortgage payments (housing expense ratio) and the percentage of gross monthly income required for the payment of all debts (total expense ratio). These calculations are called "underwriting ratios" and help to determine the amount of loan you will qualifty for. Sounds like you are doing the right thing by working to repair your credit score as this will influence the interest rate you will qualify for on your loan. Best of luck. Feel free to contact me direct with any other questions you may have. Have a great day!
Cynthia Cortes
Realtor/Partner
Licensed in PA & NJ
Remax Properties, Ltd.
210 Penns Trail, Suite 100
Office: 215-968-7494
Direct: 215-801-9315
0 votes Thank Flag Link Mon Sep 28, 2009
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