Mortgage: Lose job before closing house?

Question

My friend and her husband just bought a house but he may lose his job in a few weeks. He won't have a problem finding another job quickly but will this affect the sale of the house?

Do you have to tell them? Will the bank somehow find out before closing?

Answer 1

if he looses his job before closing they will know as all lenders verify emp,oyment just before they give the clear to close. So Yes it will

Answer 2

not all lenders verify employment just prior to closing.  It depends on your lender and whether it is small town or not.

Answer 3

If they are still in escrow and have not closed as of yet, in all probability the lender will verify employment either telephonically or will request a pay stub of the last 2 weeks of work.

Failing to produce this pay stub or the job not being verified the loan be suspended pending the out come of the verification of employment.

Failing to tell a lender that things have changed in securing a loan is fraud. This affect the ability of the person being able to pay the monthly mortgage payment.

Even if he finds another job he should still inform the loan officer of this change. This information might change the dynamics of the loan, such as ratios, change in career fields, job stability etc.

I hope this has been of some use to you, good luck.

"FIGHT ON"

Answer 4

If the house is in escrow when the job is terminated, by all means, they should tell their real estate agent. He will then instruct them what is legally required as far as disclosures to a lender. If they don't bring it up to somebody and, for example, he actually doesn't get a job right away and ends up losing the house to foreclosure, they could be investigated for mortgage fraud (lots of that going on these days).

Answer 5

Some would say not to tell. some would say full disclosure is key. In this day and age, if they do buy and he doesn't find a job quickly, they would only be hurting themselves, ie; missed payments, no upgrades etc. it would also look bad after the fact if they did get the house, and the bank found out he didn't have a job.

If he isn't sure if he will lose it or not, I would wait until he knows for SURE, then tell the bank and see what they say. there were/are some loans to be had with no income verification but they usually come with a whole world of sh@% that they really don't want to be involved in. (search subprime fiasco...)

NOW the bank repeatedly verifies this information right up  until closing, as to not have anyone buy a house that they can't afford to pay for.