What if I Don’t Have Two Year Work History to Show the Bank?

There is a lot of information out there to suggest that you have to have two year work income in order to qualify for (low down payment) mortgage; that however is somewhere between over simplification and misinformation. The banks want to see stability to be reasonably sure the mortgage will be paid and there are many sources of income that achieve this, some examples:

  • Employment in the same field as college education.
  • Social Security (in fact banks can add between 10% to 25% in the income calculation, “gross up”).
  • Investment income.
  • Having certain non occupant family members (and close family friends), back the loan.
  • (Projected) rents (calculated at 75%).

Self Employment (Schedule C) income isn’t considered to be as stable as W-2 income, so two years, or at the very least one year plus year to date bank statements, will probobly be necessary.

And most importantly in my planning, bringing on a partner(s) whom will live in the property and share ownership, to include their income.

Resources:

Social Security Income For Mortgage Lending Guidelines

Gather up your income and tax documents and bring them to your lender, smaller banks tend to be more accommodating, and discuss your options. If the traditional banks don’t work for your income or plans, you can look into hard money lenders or private lenders/OPM Other People’s Money. If the deal is good enough, there is plenty of money in this country.

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