May 3, 2017
Do commuting distances affect your ability to get an FHA mortgage? A reader asks, “I work in New Jersey and have been employed with my company for over over 20 years. Since the type of work I do I can work from home I want to move to NC. I will still be employed with my job.”
“The only stipulation with my job is I have to come to NJ for 6 weeks out of the year (not all at once) which I have no problem doing. Will I still be able to obtain an FHA loan?”
FHA loan rules in HUD 4000.1 do address commuting distances, but not all circumstances can be anticipated with the rules. In many cases FHA loan rules defer to other regulations where appropriate. In this case, lender standards may be the deciding factor.
HUD 4000.1 doesn’t have a specific rule that directly speaks to this reader’s circumstances, but in general the lender is required to make sure the borrower’s income is stable and likely to continue. In cases where the arrangement the reader has with the employer is new, there may be a different set of choices the lender has to make.
If the arrangement has been ongoing for some time (two years or more, generally speaking) the lender may have an easier time justifying loan approval. Commuting distances can be a serious issue depending on the situation.
Some borrowers may find it harder than others to get a home loan approved depending on the specific nature of their circumstances.
In this particular case, the reader would do well to discuss this situation with a loan officer. Commuting distances may be viewed differently in “work-from-home” cases where there’s a long, established relationship with the employer and the only major change is the location of the borrower’s home.
Those who have come into such arrangements more recently may have to provide additional documentation, sit out a waiting period, or other factors depending on the lender.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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