Low Income

[Rkalynsmith]

Trying to move some numbers around and IM trying to see if I can get approved in the next year or so. I make roughly 22k a year driving a school bus part time. (37 hours a week) I know its not much but its just me. I have 7k in savings and that's only been 9 months. My rent is SUPPOSE to be $600 a month but I pay like 400 a month. (Mom owns the house im living in. Rental property) no auto loans. No CC debt. I was looking at houses for like 60-70k. I wouldn't have a problem putting 20% but here's the problem. Everyone assumes bus drivers are off during the summer which is false. I slave more during the summer than I do all year long. We do have 2 weeks off for xmas and 1 week for spring break and maybe 10 days off here and there just because. Will a bank take a chance on me because of the type of job I have and will I get approved based off my income? My credit will be fine by then (I'm hopeful). My income is the only thing im worried about. 

[Rkalynsmith]

any1?

[Jim-WI]

Thanks for the post Ryalynsmith.  I can only tell you my story.  In July, I app'ed for three (3) CC's.  Discover, USAA VISA and USAA MC.  My yearly income is $27,000, and I'm a bartender.  Because of my job, my income fluctuates (because of tips).  When filling out the applications, the above two (2)  CCC's asked for my yearly income only, and no question was asked about my profession.  My AAoA was pretty high (at 18 years).  These were the first CC's that I have ever applied for.  I had an auto loan and a student loan.  My EQ score was 767, my TU and EX were in the mid seven hundreds, with no baddies on any of my reports.  All three (3) of the applications were approved, and my CL's were: Discover $4,500; USAA VISA $5,500; and USAA MC $6,000.  I've seen other posters here with less yearly incomes than yours get CC's too.  I wouldn't worry too much about your profession, IMHO.  Once again, this was just my experience.  As anything, your mileage may vary.  Take care, and best of luck to you!

[StartingOver10]

Jim-Wl, welcome to the forums!

The OP is asking about a mortgage which is treated differently than applying for a credit card.

The mortgage company will check out the borrowers income by checking pay stubs, tax returns and employment. The checks are extensive but reasonable. People that are bus drivers get mortgages. The type of job you have will not be held against you.

What the mortgage company will also check is your debt to income ratios including the monthly cost of the new place you plan to buy. They will also check to make sure you don't have payment shock and will definately do a rent check to make sure you are paying as agreed. The problem with renting from private landlords and from relatives in particular is that you are going to not only have to show a lease, but rent payments made monthly on time each and every time for the full amount of the rent. In your post you have not been paying the full amount of rent, that is a problem.

The mortgage company will want to make sure you don't experience "payment shock" either (that is a new mortgage payment much, much higher than what you are accustomed to paying in rent).

For the OP you are going to want to start making your full rent payments each and every month on time with a check or money order (something traceable for the lender). You will probably need to supply proof of payment to the landlord for at least the previous 12 months to the  lender to show you have the capacity and the willingness to pay your rent on time. No more short checks. No cash payments. It is better if you show canceled checks because the lender can see the date you wrote the check and the date it was deposited by the landlord to determine if the payments were made on time. You will also have to show bank statements for each of your bank accounts including the account from which your rent payments are made. 

[Jim-WI]

Wow!  I'm so sorry for missing the boat on this one.  You are correct, I totally mis-read what they were looking for.  Thanks for correcting my obvious error, StartingOver10.  Have a great day!

[StartingOver10]

No problem!

[Rkalynsmith]

I can show receipts for the full amount! That's not a problem. I plan on getting this mortgage late 2014 early 2015. So I'll be sure to start using money orders now. 

[StartingOver10]

If you have just receipts, they aren't the full documentation that it was paid by you. That's why I mentioned keeping copies of your actual payments. You're in a tough spot because your landlord is your mother and the lender automatically believes that the rent payments need extra scrutiny.  If your landlord accepts personal checks then use personal checks. If not use the bill pay feature on your checking account and make sure to download a copy of the front and back of the cashed check to show the date sent to the Landlord and the date cashed by the landlord. The bank checks the dates that is why they require front and back of the cashed check.  Otherwise, use money orders or cashiers checks. Keep copies of everything so you can prove your rent payments and you won't have any rent verification issues. This is important for private landlord rent verification and critical if your landlord is a relative.

If it is an apartment complex, the lender will generally accept a VOR (verification of rent) from the property management company.

[Target1212]

I make less than that and got a RD mortgage for 150K. My lowered payment will be 600/ mo including taxes and insurance. Way less than my rent! I would check them out. I did give them my landlord info but that was only because i didn't have 3 open trade lines for over a year, if I did they didn't need it. 

[Rkalynsmith]

Thanks target1212 i will check into that!