topic Re: Maternity Leave & Closing on a House in Mortgage Loans

Maternity Leave & Closing on a House

Anonymous — Fri, 12 Apr 2019 18:31:25 GMT

So as it is my wife will be the only one on the title for our mortgage when we close the first week of September because of a surprise hit to my credit. She has been approved for a 4.375 interest rate for the house we are building. One thing we just thought of and are unsure if this is an issue is that she is pregnant and her due date falls the same week we close. If she were to have our daughter earlier (let’s say 2 weeks earlier) will it kill her interest rate because she will be on STD?

Re: Maternity Leave & Closing on a House

JVille — Fri, 12 Apr 2019 21:55:31 GMT

Yiks! And tell Baby to stay put.... get builder to hurry and get done early. She is the sole borrower???? and may be on leave at same time as COE.
You need to speak with your lender now! It could be a huge problem or maybe nothing but you need to plan ahead for the worst case scenario.

Re: Maternity Leave & Closing on a House

CreditInspired — Fri, 12 Apr 2019 22:18:45 GMT

Eww. This could be a problem. As @JVille noted, discuss with LO ASAP. It’s more than just the APR. STD is something like 60% of income and that will be a big blow to DTI ratio. When does she go back to work?

Re: Maternity Leave & Closing on a House

Anonymous — Fri, 12 Apr 2019 22:47:49 GMT

We did and he acted like it was no big deal but it still has me worried.

Re: Maternity Leave & Closing on a House

JVille — Fri, 12 Apr 2019 22:51:48 GMT

You have good reason to be concerned. This loan is in wife’s name alone? Did she supply employer HR letters regarding income while on leave and that she is Guaranteed her job back at X $$ Salary ? So they have qualified you as if she is on leave using that income alone?

Re: Maternity Leave & Closing on a House

Anonymous — Fri, 12 Apr 2019 22:52:12 GMT

She’ll go back to work in 3 months, but if all they ask for 2 last paystubs and she has PTO to buffer it will that still be an issue?

Re: Maternity Leave & Closing on a House

Anonymous — Fri, 12 Apr 2019 22:55:20 GMT

It will be in her name but she isn’t on leave yet. She isn’t due until September and won’t go on leave until she has the baby. She will have two weeks of PTO and won’t go on STD until that is used up.

Re: Maternity Leave & Closing on a House

JVille — Fri, 12 Apr 2019 23:13:43 GMT

They will verbally reconfirm employment just prior to producing loan documents. And yes she will have to updated file with pay stubs 30 days or so prior to COE. Does your wife qualify if the baby comes in August? They have tiny minds of their own and they tend to arrive when it’s least convenient (early late).
Is it possible your home could be done early?

Re: Maternity Leave & Closing on a House

Anonymous — Fri, 12 Apr 2019 23:27:03 GMT

I don’t think they could be earlier. I’m not even sure what we should be worried about? I read that they can’t deny her approval (discriminating) since she will be returning to work and this is just temporary. She would have to have the baby at 35-36 weeks for us to miss the 30 day window.

Re: Maternity Leave & Closing on a House

JVille — Sat, 13 Apr 2019 01:11:47 GMT

This is not about Discrimination, it’s about Underwriting her income at the time and what the Employer is willing to put into writing. I’m surprised the issue has not been addressed or maybe UW has not idea of this possible concern.
The timing is just not good but Babies are always a blessing. Being on STD or Maternity leave is not ideal when it coincides with closing a Mortgage.
I wish you the best, if you Lender says no problem then ok that’s a good thing.

Re: Maternity Leave & Closing on a House

Anonymous — Sat, 13 Apr 2019 01:15:03 GMT

He said he would run her credit 60 days before closing and collect pay stubs in early August (so I’m guessing he means pay stubs from July)