Mortgage approval as a temporary employee
Are temporary full-time employees eligible for conventional, FHA or other types of home mortgages? I live in Florida, if that matters.
One broker I spoke with stated he could not work with me, and that I wouldn't be able to get any conventional or other loan, except private financing because I'm technically a temp employee.
I've read online elsewhere though that you can still get a mortgage, but it will be harder (have to have good credit score, possibly put more down, etc). Some of these sources are a few years old though. I have great credit and salary.
I have gotten approved by a couple of brokers. All they asked was if I was a W2 employee. I'm wondering if when they do a job verification they'll deny me if they see I'm temporary?
I want to make a offers on a couple properties, but am not sure what to do because of this situation. Should I move ahead and make offers, counting on the pre-approvals I've received? Would there be any costs I'd end up losing if my loan falls through because I'm temp? I don't want to lose some good deals, but also don't want to be reckless.
In the mean time I'm working with my company to try and change my employment status, and am also looking at private financing.
I appreciate any advice on this.
If you worked at the same job for the last 2-3 yrs and or same industry for the same time period, with good credit, good dti ratios, good dtc ratios I dunno why you can't.
If your full time your full time.
That's good to hear. I should clarify, by full time I mean I am paid hourly, and can work up to (and do work) 40 hours a week. That should work right?
Originally posted by @Joe Henry:
That's good to hear. I should clarify, by full time I mean I am paid hourly, and can work up to (and do work) 40 hours a week. That should work right?
This is likely going to be treated like self employment for the purposes of calculation of income, and the LESSER OF whatever is implied by a YTD average (paystubs), a 2 year average (tax returns), or a 1 year average (tax returns), provided that you've been doing this temp work for two years.
If your DTI is loose, don't worry about that. If any one of those three methods busts your DTI, you may want to drill down with whoever preapproved you on how they're doing their math.
@Chris Mason, thank you both for your advice. I've spoken with my broker and it appears the only sunk costs I can have by moving forward with this are inspection fees if indeed my financing falls through. Does that sound right?
Originally posted by @Joe Henry:
@Chris Mason thanks for the info. The temp work started in April of '15, and prior to that I was a full-time employee at another company. Any of the methods you mentioned for calculation of income should do pretty well for me I think.
Seems the broker who told me I wouldn't be able to get any loan aside from private financing was mis-informed?
@Daniel Okorie, thank you both for your advice. I've spoken with my broker and it appears the only sunk costs I can have by moving forward with this are inspection fees if indeed my financing falls through. Does that sound right?
Ah, I didn't know that you've been doing it for less than 12 months. Was your full time job doing basically what you do now?
Yes, I've been in the same career for 5+ years now, all of that time as a full time salaried employee except for the time since last April. That's good for my approval I would hope?
Originally posted by @Joe Henry:
Yes, I've been in the same career for 5+ years now, all of that time as a full time salaried employee except for the time since last April. That's good for my approval I would hope? (but I've been on my current job as a temp for less than a year)
Honestly this one might come down to my ability to write well and my relationship to that particular underwriter - if she got sufficient Christmas cards, etc, from me, if this were a "pick me up" deal that Wells or whatever preapproved you for.
This really should all have been addressed and pre-underwritten at the preapproval stage. I wouldn't have preapproved you based on what I've read without having my local underwriting manager (the boss of the actual decision making underwriter) take a look and sign off in writing.
She hasn't done that, and this isn't my deal either from the start or as a pick-me-up, so I will decline to answer either way. This very well might work out fine for you, but I don't see it being a sure thing by any means at this point.
Either way, this should be a lesson learned about the "I preapprove in 15 minutes!!!" Fast Freddie type lenders that ask you for nothing but paystubs, bank statements, and a credit pull.
Chris:
Do you lend in Nevada?
Mike
@Chris Mason, thanks for the input.
Either way, this should be a lesson learned about the "I preapprove in 15 minutes!!!" Fast Freddie type lenders that ask you for nothing but paystubs, bank statements, and a credit pull.
What do you suggest I do to find a better lender? Would smaller independent firms do better?
It seems you are recommending I state right up front my employment situation and work through it that way, correct?
@Michael C Gregory - Sorry my friend, I do not.
@Joe Henry - Your Realtor has a short list of local lenders that will a) beat you up with more paperwork and more questions up front, which will either lead to b) closing deals and closing on time, or c) telling you what you need to do in order to obtain conventional mortgage financing and giving you a game plan.
I'm an extreme version of that -- my "preapproval checklist" and my "we're in contract, what do we need?" checklist are the same list. It's an e-mail signature. FTHB don't know that I'm beating them up early for their own good (even if it's a cookie cutter deal, they're going to have enough on their plate with inspections, etc, that they will be glad I took this mountain of paperwork OFF their plate early on), but people that have owned homes before get pissed at me and say "WTF, we're not even in contract yet?!" and I say a more polite version of "Nope, we sure aren't. My list stands. By all means tell on me to your realtor or call 1-800-Quicken." :P
@Chris Mason, that's good advice. I'd rather have something fail in the pre-approve stage than after I've made an offer and all that. I'll be looking for someone locally who provides service like that. Thank you for the advice.