The Smooth Loan Process


Back to School Edition - TSLP #2011-1

It's hard to believe but my kids have already started back to school this year. Even harder to believe is that my oldest one is in high school! How did this happen? When did I get old enough to have a high schooler? If I'm not careful, I'll start eating dinner at the four o'clock buffet and going to bed while it's still light out.

In my efforts to remain young at heart, The Smooth Loan Process blog is back in business. Young people blog, right? So watch how young I am now.

Since we're headed back to school, let's talk about teachers. Lot's of teachers buy houses in the summer. Especially the new teachers that have just graduated from college and are getting their first job. New teachers, be careful with your timing! Some loan programs require that the buyer has been on the job and received pay checks for the first 30 days. If our new teacher needs to close on that dream home in July but does not start work until August, we might be in trouble!

FHA loans in particular require a pay stub with at least 30 days of earnings on it before we can close on the house. If you're a new teacher, fall break would be a better time to plan that purchase than summer.

Of course, it's not just teachers that have to watch the timing of their purchase. Anyone new to the workforce can have issues. Recently, I had a new attorney that had to delay his purchase because he graduated from law school in May but did not start his job in the court system until September.

The rules are much more lenient if you have a larger down payment. If your down payment is 20% or more, an offer letter from your new employer or an employment contract can be used in place of the pay stubs. Even with that, you still have to have a two year employment history or college or trade school education to use in place of the employment history

The Smooth Loan Process Lesson for Today: It's hard to get a mortgage if you don't have a job.

Harold Perkins
Galaxy Lending Group, LLC


April 2014

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