What if I want to change jobs just before or during loan application?
Changing jobs can have several effects on your loan approval and most of them are not good. Always ask your loan originator before changing employment.
For example, if you are employed and decided to start your own company, you would need to wait for 2 tax returns to be filed before we could use your new income for your new company. Even if it’s the same line of work and you expect to make a lot of money. The money cannot be determined until the lender sees 2 years of filed tax returns.
If you are changing jobs and you are paid hourly or salary, and you have had stable job history with no gaps, and you are improving your income, you would probably be OK if you do this prior to loan application. Most lenders want at least 30 days on a new job in the same line of work and you must not be in a probationary period.
Another example is taking a job that pays you as a 1099 contractor when you have been paid W-2 in the past. This would require the same 2 year history window as the self-employed borrower discussed above.
Always check with your loan originator if you are contemplating a job change.
Learn more: Employment / Income Related Questions
- What if I want to change jobs just before or during loan application?
- My job is good through the closing date and 1 week after closing, I have a new job. Is that OK?
- I haven’t filed my taxes for this year (or previous years). Can the lender use the last two years that I have filed?
- I just filed today and the IRS can give me a printout that I filed. Will that be sufficient to close the loan.