March 10, 2014
A reader asks, “I have been employed at a job for 5 years, and another for 1yr 3 months and looking to quit both for a 3rd job I have been employed at for 4 months. the third job is currently under the table until I am able to be full time. we are looking to buy our house in April. Should I wait to quit the other jobs or will I be okay?”
We can’t give advice on whether to keep or quit a job (that’s outside the topics we cover here) but one thing that’s important to remember in these types of situations is the lender’s requirement to verify both income and employment.
Any job that is, as the reader question puts it, “under the table” would be unverifiable income. The lender must document all sources of income and determine that the income is stable and likely to continue. Any “under the table” income, or even income that is able to be documented but is unreliable (such as selling on eBay, for example) would not be counted as verifiable income.
The borrower should know that employment is verified by contacting the employer–the FHA loan application form requires you to list employment history, income amounts, and you may need to submit tax paperwork from past returns to help fully develop your earning history.
This is especially true for borrowers who are self-employed or own their own businesses. The reader question here is obviously not geared toward self-employment, but it’s helpful to know the expectations if they apply to you.
FHA loan rules may seem stacked in favor of those who have full-time, all-year work but there are provisions made for seasonal work and employment that doesn’t last the full calendar year but does meet all the other FHA loan requirements for stability and duration of income. Borrowers who are unsure whether their employment situation meets the FHA loan program’s requirements can get in touch with the FHA directly at 1-800 CALL FHA.
Do you have questions about FHA home loans? Ask us in the comments section. You can apply or get 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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