what happen if u lose a job before closing date?

Question

my closing date is aug. 8. i think my job mabye in jeopardy. if i lose my job before closing date...do i have to tell my mortgage bank? what happen if i get another job before than? do i still have to tell them? yes or no?

Answer 1

Do your best to maintain your job at this point while looking for another job. You may want to consider getting 2nd job at this point just in case. More than likely, the loan company is not going to ask you. They may find out and the deal will fold. Some companies are known to check the day of closing.

Remember you could lose your job immediately after closing and be in the same predicament. You would have to decide if you willing to take the risk. If you are willing, use the "don't ask don't tell" policy.

Answer 2

YES, you must notify the lender! Part of the paperwork you've already signed stipulates that you must notify them immediately of any factors or changes to your circumstances that could affect your creditworthiness. Loss of a job most certainly DOES affect your creditworthiness and failing to notify them of any material fact is mortgage FRAUD and is a CRIME in many jurisdictions.

Even changing jobs could affect your creditworthiness or qualification for the loan currently on the table so you need to notify them of that as well. If the new job is in the same general field with similar or better money you'll probably still be OK but you do need to notify the lender. At the very least when they pull the final employment verification (usually within 24 hours of closing) you don't want them calling your former employer to be told that you are no longer employed there!

If you have a "hunch" that your job might be in jeopardy there might be some wiggle room, but if you have good reason to suspect that your employment situation will change prior to (or shortly after) closing then you do need to notify the lender.

Frankly, since the ramifications of a job loss even discounting the legalities of the situation can be devestating -- foreclosure, etc. -- if you have any reason to believe that your job is at risk you should back away until you are on more certain grounds.

Losing a home that you haven't bought yet may be painful but it's not NEARLY as painful as losing one once you HAVE bought it. If you have to walk away now, at least your credit will still be intact. But if it's taken away from you later your credit will be in tatters and it will be a long time before you'll have the opportunity to buy a home again.

Please use some common sense here -- and IGNORE the clueless rubes who tell you otherwise, either in this forum or elsewhere!

Answer 3

It seems you are guessing you might lose your job; that is different than you actually not being employed. Your fears on something not material is not fraud if you only are concerned about losing your job. Anything can happen. As long as you are employed at the time of closing you'll be ok. Try to get closed early. Maybe your employer will extend your job for the needed time.

Honestly it might not be the best time to buy if your financial future is so unsure and this may be a good excuse to get out of the contract.

Answer 4

OK, why is everyone who suggested "don't ask, don't tell" getting thumbed down???

This happened to me 5 years ago. We had a home built in a development, expected to close in late October. I was laid off by my employer of 12 years four weeks prior to closing. They told me that my official layoff date would be on the same day as my closing, and that, if the bank were to inquire of my employment status prior to closing, that I would still be marked employed.

I decided to not tell my bank and proceed to closing. I figured, with my severance and savings, my family could ride out my layoff and meet our financial obligations. The bank never knew. The only ones who knew were my RE attorney and my home inspector. The HI only knew after the closing what happened.

You can call it fraud, but I believe that, if I'd failed to go to closing with the financing in place, we would've had a much more difficult time finding another lender who'd take us on. Besides, I'm taking on the risk that I won't make my payments. If I screwed up, I knew full well that I would be solely to blame.

I didn't find a job until 9 months later out of state, so we ended up having to sell the house eventually. We made all our payments on time.

Good luck whatever you do.

Answer 5

yes you need to tell your loan officer, in writing, what is going on. Part of the last process of funding a loan is calling the employer to verify your still there. If your not, the will not fund the loan. If you change jobs thats ok as long as it is in same line of work and the pay is the same or better but it may delay the process a couple days. The best policy is to always be upfront because the lender will find out...

Answer 6

bostonianinmo is correct. Ignore the unknowledgeable rubes in this forum. Most lenders will do a last minute credit check AND employment verification to insure that nothing untoward has changed in your financial situation. If the lender calls your employer to verify employment and HR tells them that you no longer work there, what do you think will happen ? HINT: your mortgage will flatly denied on the day before or day OF closing. Yes, lenders reserve the right to do so.

Answer 7

I hope that you won't lose your job. But with that said I think that if you do lose your job the bank would need to know. Good Luck to you.

Answer 8

Once you have been approved for the loan, unless they ask, you don't need to submit that info. If you already have a closing date, you are ok. the thing to consider is whether you want to go ahead with the purchase. Will you be able to make the payments?

Answer 9

No, don't tell them anything, but for your sake, you had better start looking for a job soon, or you'll be out of luck.

Answer 10

It might be a blessing. When things are moving fast it is sometimes good to slow them down.