August 11, 2014
A reader asks, “I am currently living if Florida and wish to try to get an FHA to buy a home in Illinois when I return there next year. I am a nurse and I have heard you must be employed for same employer for at least 1 year to be eligible for FHA loan. Since I will be moving back to Illinois will I have to wait 1 year after I move to apply?”
FHA loan rules covering the reader’s employment history question can be found in HUD 4155.1, Chapter Four, Section D under the heading, “Stability of Income”. That section states clearly:
“To be eligible for a mortgage, FHA does not require a minimum length of time that a borrower must have held a position of employment. However, the lender must verify the borrower’s employment for the most recent two full years, and the borrower must
• explain any gaps in employment that span one or more months, and
• indicate if he/she was in school or the military during the most recent two full years, providing evidence supporting this claim, such as college transcripts, or discharge papers.
Allowances can be made for seasonal employment, typical for the building trades and agriculture, if documented by the lender.”
However, borrowers should know that there may be additional considerations and requirements when it comes to working as a self-employed person or small business owner.
You may be required in such cases to supply additional documentation including tax statements, profit-and-loss sheets, and a record of your history as a self-employed person to have earnings from such employment considered as verifiable income.
Discuss your specific situation with a loan officer to get more clarification on what might be needed in your specific case.
Do you have questions about FHA home loans? Ask us in the comments section. You can get information about applying or getting pre-approved for an FHA loan at FHA.com, a private company and not a government website.
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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