Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Getting a loan, new job, vent
My husband and I have been looking at homes over the past 4 months. I just left my salaried position to start my own practice. Now we're concerned that we won't be able to get a large enough mortgage to buy the type of home we want because I don't have a couple years of income to show for my new self-employed status so the banks may only consider husband's income. Feeling a little deflated and anxious because home prices are increasing and interest rates may also increase. This new self employment should result in an increase in my income; however, I'm not sure if we'll be able to buy anytime soon and we don't want to settle and buy a house we don't want. Any advice?
Re: Getting a loan, new job, vent
It's very true that lenders look very closely at self-employed income with magnifying glasses and fine-toothed combs. Without being able to show them longevity AKA a successful business, they will be hesitant to loan. They will like ot hear about your income potential, but until there is hard proof of that actual income (which is what they base lending decisions on), you may have some roadblocks.
But, the fact that your husband has stable income and if you both have good credit with a solid down payment, there is a shot here.
Home prices are rebounding slightly in some markets. But even still many, many more foreclosures are being processed all the time, which keeps markets sluggish. Also, it's doubtful the interest rates will increase in the near future and if they do, it will be slightly. Both these things can work in your favor.
Ultimately, you doing your own thing was important to you, so you can feel good about that decision to become self-employed. It ultimately comes down to priorities, if you think that it will be tough to get the loan you want, you can try and see or you can just wait and save a lot of money for your future home and down payment while you live where you are.
Overall, home buying and its process doesn't need to be a race against time or any other factor. Get your ducks lined up and then buy when you are ready and can afford the home you desire.
Another point to consider is maybe since the new biz is not yet off the ground, you should wait anyway before taking on a mortgage. You said you have lots of income potential...that's awesome, but maybe to protect your future financial security you should test out the new biz and see what the actual income is before saddling yourself with a hefty loan.
You shouldn't get demoralize. Still you can get a loan but you have to think on few aspects like:
1) Before house hunting, get yourself pre-approved
2) As you are going to Buy Your Second Home then you should also think on whether you can afford payments of both houses if u dont sell your current home.
3) As you have a new job you can go for Home Equity Line Of Credit
it means getting loan against the equity in your home.
4) Avoid a Bidding War
For more information Visit http://www.real-estate-yogi.com/index.html
Thanks for the feedback. That helps a little.
Husband and I are planning on making sure the income is there before buying, which was part of the thought process behind me leaving my job, so that we would have more money to put toward a house and our future.
I just hope that this all works out and we are able to buy the home that we would like and in all reality should be able to afford based on my income as well.