Ask The Experts: Question of the Week
Our loan scenario desk experts receive thousands of questions from our subscribers.
Our experts work in the field and have over 25 years of experience, which is why they are known for saving a lot of deals.
We hope you learn something new!
FHA Job Gap – Back to Work History
Question:
FHA recently changed the Employment Gap guideline to clarify that the borrower must be “employed in the current line of work” as opposed to “in the current job.” This was to allow for more than one employer during the six-month period. (See the guideline below.) Make sure that you can verify a solid two-year history prior to the gap, which is the second part of this requirement.
Reference:
4000.1(B) Addressing Gaps in Employment
For Borrowers with gaps in employment of six months or more (an extended absence), the Mortgagee may consider the Borrower’s current income as Effective Income if it can verify and document that:
- the Borrower has been employed in the current line of work for at least six months at the time of case number assignment; and
- a two-year work history prior to the absence from employment using standard or alternative employment verification.
Our subscribers can access the Income Analyzer – Gaps in Employment – All Agency Comparison chart under our “Income Analyzers” page.
Each month, MortgageGuidelines.com posts a Q&A issue, which is a sampling of questions that we receive from our subscribers. It’s a popular article as subscribers learn quite a bit from peer questions and the answers from our experts.