You’ve got a shot at a new job and you want to buy a home. How will a brief work history impact your mortgage loan?
Lenders are most concerned with your ability to repay your mortgage loan, including the likelihood you’ll keep your income and whether you’ll be making enough in salary to pay your debt, such as student loans, and your mortgage.
Without much work history, lenders look for other ways to gauge your ability to repay your loan, like whether you’re on track with your career. What do the last two years of your life say about you – are you job -hopping with no clear direction or are you focusing on your career of choice? That improves your chances of promotion and your ability to repay your loan.
Student debt makes it harder to afford a home, so lenders like to cap total household debt at 41 – 43%. That includes your mortgage payment, revolving debt, child support, and student debt.
If that leaves little left over, you can still buy a home. Choose a smaller or less expensive home, a home that needs work, or a home further from your ideal location. You can also pursue a low-down payment loan like FHA at 3.5% or zero-down VA.
If you want to change jobs, make sure to show progress, such as a higher salary, better benefits, a better title, or some other positive. Talk to your lender about the pros and cons of making a job change now.