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I was just put on furlough with a target return date of May 31st. Will my furlough period impact my ability to get a mortgage?
I was pre-approved for a second investment property mortgage before CV-19 hit. I really think the local shore towns here in NJ are going to get hurt this summer and we could see a historic price drop come winter. My original plan was to purchase a vacation rental within the next 4 years, but If a $600k house can be had for $400k why not do it now.
I don't think it'll hurt me since if the mortgage company calls my employer to verify they'll see I've been with them for X years... just curious if anyone has insight.
You need to let that lender know, and ask them. Guessing it will put you on hold until you're working again, but may not count against you if you do start working again in May. But the big picture and the outlook for the future and odds of it happening again matter.
We're working through a refinance right now. It's all good so far, but outlooks are very uncertain.
Yes it will prevent closing on any mortgage transaction until you have returned to work, and provide a paystub (maybe paystubs covering a full month) and your employment is also manually verified.
If you are a full-time, salaried employee, and you return to work at that same status, you should be ok once you get paystubs. however if you are part-time, earn bonus or commission, that income will have to be averaged over 2 years. yes they will likely leave out the furlough period, but in some industries it might take time to generate commission or bonus, so it may take longer to get into approval.
Lenders are verifying employment, the likelihood of sustained employment, any reduction in income, and are contacting employers the day of/before closing to again verify employment.
Yes it will prevent closing on any mortgage transaction until you have returned to work, and provide a paystub (maybe paystubs covering a full month) and your employment is also manually verified.
If you are a full-time, salaried employee, and you return to work at that same status, you should be ok once you get paystubs. however if you are part-time, earn bonus or commission, that income will have to be averaged over 2 years. yes they will likely leave out the furlough period, but in some industries it might take time to generate commission or bonus, so it may take longer to get into approval.
Lenders are verifying employment, the likelihood of sustained employment, any reduction in income, and are contacting employers the day of/before closing to again verify employment.
Ok that's what I figured. My pre-approval was based on pay stubs from base salary alone, we never bothered getting into commissions and bonus as it wasn't needed for the request size. I wouldn't plan on moving forward with a purchase until October at the earliest, if I'm still out of work by then I'll have bigger problems and the purchase wouldn't happen anyway.
I was more curious if I do go back May 31st or if it stretches out till say July if I went back to work and looked to make a purchase in Oct if I'd get a hard "NO" because I had a "gap in employment", but I don't think a forbearance is viewed that way so long as you qualify via pay stubs which we should.
I was more curious if I do go back May 31st or if it stretches out till say July if I went back to work and looked to make a purchase in Oct if I'd get a hard "NO" because I had a "gap in employment", but I don't think a forbearance is viewed that way so long as you qualify via pay stubs which we should.
Can you clarify? Were you planning on getting another mortgage while in forbearance?
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