FHA employment history

[JediNeo]

I recently submitted an app for an fha loan and had a question in regards to employment history. From what I have read, approval requires two years of continuous employment. Are there exceptions to this rule?

I had continuous employment from 2011 through 2013. Due to the company shutting down our location and a down economy in my area, I was basically unemployed for 2014. I landed back on my feet in 2015 and just received a wage increase.

The LO I talked to said it shouldn't be an issue. However I worry UW might have a different opinion. She has basically pre appoved my app, just need to complete my gift funds letter. I would hate to get into contract and UW reject my loan due to the employment gap.

[DallasLoanGuy]

that would be underwriter discretion....  fha considers job stability after 2yrs in the same line of work with no large gaps.

a strong file might be fine.... a weak file will likely suffer the denial fate.

is earnest money at risk?  when can the uw see the file?

[Anonymous]

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@JediNeo wrote:

I recently submitted an app for an fha loan and had a question in regards to employment history. From what I have read, approval requires two years of continuous employment. Are there exceptions to this rule?

I had continuous employment from 2011 through 2013. Due to the company shutting down our location and a down economy in my area, I was basically unemployed for 2014. I landed back on my feet in 2015 and just received a wage increase.

The LO I talked to said it shouldn't be an issue. However I worry UW might have a different opinion. She has basically pre appoved my app, just need to complete my gift funds letter. I would hate to get into contract and UW reject my loan due to the employment gap.

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FHA rules are if you were out of work more than six months, you need:

1. Employment at the new job for at least six months

2. Two year work history prior to the absence from work

[JediNeo]

Thank you for the replies. EMD is not as risk, as I haven't entered any contacts yet. I wanted to nail down the pre-approval before doing any serious looking.

My previous employment prior to the gap and after is within the same industry. I'm hoping that my two prior and year after the gap will get approved by UW.

[DallasLoanGuy]

is loan officer submitting the file to uw for preapproval?

that job gap is a layer of risk

using gift funds adds a layer of risk

if anything else like credit is dicey, thats a layer of risk.

[JediNeo]

Not sure if it's going to UW prior to pre approval, I'll have to ask. LO stated credit is excellent. She asked if I could get gift funds in order to get a better rate vs the higher rate using s DPA program.

[Anonymous]

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@DallasLoanGuy wrote:

is loan officer submitting the file to uw for preapproval?

that job gap is a layer of risk

using gift funds adds a layer of risk

if anything else like credit is dicey, thats a layer of risk.

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Yup, still UW discretion.