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Rainer
123,127
Ken Jones
Kenneth J. Jones, Inc. - Rahway, NJ
Commercial Real Estate Broker & Appraiser

Rodney Downs If a buyer uses a loan program for "low income" buyers, getting a raise that elevates the buyer's income above the maximum income allowed by that program will disqualify the buyer from that loan program.

Feb 12, 2021 08:18 AM
Rainmaker
541,264
Jason E. Gordon
AmeriFirst Financial Inc, San Diego, CA - San Diego, CA
Sr Loan Officer, CMA, CMPS, CDLP, CDRE, RCSD, CDPE

Despite the fact that a higher "per hour" compensation may be present, one could easily disqualify themselves from a loan if they go from full-time "guaranteed" hours to "per diem" hours.  

EXAMPLE:

Borrower earns $20 per hour with 40 hours guaranteed per week, but then accepts a per diem opportunity to instead earn $35 per hour (when called upon).  In the eyes of a Borrower, they got a raise. In the eyes of the Lender, there may be months where the Borrower doesn't earn a penny.

Essentially, per diem means you are a "hired gun" with no guaranteed hours...and the lack of guaranteed hours could be the problem.

Feb 12, 2021 09:12 AM
Rainmaker
3,896,855
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

Over the years, I have avoided talking about the more detailed explanations of loan qualification leaving such discussions to professionals in that particular field.   Experts can give a better-informed answer.  And advice.  

Feb 12, 2021 09:28 AM
Rainmaker
856,037
John Juarez
The Medford Real Estate Team - Fremont, CA
ePRO, SRES, GRI, PMN

Some special programs are for those below a maximum income level. I recently represented a buyer family in an attempt to purchase a home where the one of the requirements was that the family income did not exceed a certain level.

There were 80 submissions for the chance to buy the home.

Feb 12, 2021 09:11 AM
Rainmaker
6,277,437
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

Some local programs have a maximum income to qualify.

Feb 12, 2021 08:18 AM
Rainmaker
956,993
Doug Dawes
Keller Williams Realty - Topsfield, MA - Georgetown, MA
Your Personal Realtor®

I'll be interested in the answer

Feb 12, 2021 09:49 AM
Ambassador
3,197,664
Anna Banana Kruchten CRS, CRB, Phoenix Broker
HomeSmart Real Estate BR030809000 - Phoenix, AZ
602-380-4886

Depends on the loan program.

Feb 12, 2021 09:31 AM
Rainmaker
3,276,668
John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

Hello Rodney Downs generally it depends on the loan program.

Feb 12, 2021 09:21 AM
Rainmaker
823,068
Jeff Pearl
RE/MAX Distinctive / LIC in VA - Lovettsville, VA
Full Service Full Time Realtor

Depends on the loan program usually. VHDA loans for example. We have Federally Targeted Areas of Economic Opportunity here where they allow lenders some flexibilty with programs.

Feb 12, 2021 08:32 AM
Rainmaker
860,880
Annette Lawrence , Palm Harbor, FL 727-420-4041
ReMax Realtec Group - Palm Harbor, FL
Making FLORIDA Real Estate EZ

 A probationary position requiring skills the work history does not support.
Example: Currently manufacture dentures in the basement and new position is regional sales represtnative on contingency income with the same company.

Feb 12, 2021 08:17 AM
Ambassador
2,983,984
Kathleen Daniels, Probate & Trust Specialist
KD Realty - 408.972.1822 - San Jose, CA
Probate Real Estate

That will depend on the loan program the buyer qualified for. 

Feb 12, 2021 11:30 AM
Rainmaker
3,822,729
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

Is it a loan that limits eligibility for the loan based on some maximum amount of income?

Feb 12, 2021 11:28 AM
Rainmaker
5,276,264
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Rodney,

You have excellent answers. A

Feb 12, 2021 10:17 AM
Rainmaker
1,352,258
Ryan Huggins - Thousand Oaks, CA
https://HugginsHomes.com - Thousand Oaks, CA
Residential Real Estate and Investment Properties

Some good answers here.  I would have said never, but had never heard of these low income loans before.  Thanks for the learning opportunity!

Feb 12, 2021 02:19 PM
Ambassador
3,013,277
Tammy Lankford,
Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 - Eatonton, GA
Broker GA Lake Sinclair/Eatonton/Milledgeville

Well I had a buyer who was just under the USDA limit once that certainly couldn't have qualified for the no downpayment loan she got with a raise... she was literally like $50 under the limit for a single person.  Of course the next year she had the house and got a raise.... all good.

Feb 12, 2021 12:27 PM
Rainer
245,998
Don Baker
Lane Realty - Eatonton, GA

loan programs with income caps

Feb 12, 2021 02:09 PM
Rainmaker
1,685,606
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg Real Estate

Max income on a loan type. 

New pay not guaranteed with hours or some slick variation.

Feb 12, 2021 12:07 PM
Ambassador
4,445,685
Jeff Dowler, CRS
eXp Realty of California, Inc. - Carlsbad, CA
The Southern California Relocation Dude

That's really a great question for one of our mortgage officer members - Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi , John Meussner  or George Souto for starters

Feb 12, 2021 08:12 PM
Ambassador
945,667
John Meussner
Mason-McDuffie Mortgage, Conventional Loans, Jumbo Loans, FHA, 203(k), USDA, VA, - Walnut Creek, CA
#MortgageMadeEasy Walnut Creek, CA 484-680-4852

Jason E. Gordon gave a great example.  Another very easy example that comes to mind is with the USDA loan product - it is income driven and exceding a certain income in a certain area is an automatic "no" for the program.

 

Some down payment assistance programs are also set aside only for those within a certain % of AGI (adjusted gross income), usually comparable to local 'povery level' numbers.  Exceding the income threshold on these products can cause a borrower to no longer qualify as well.

 

Typically a raise is a good thing, but some programs have income caps, and lenders also care about consistency and "likelihood of continuance", so while a raise is nice, 'change' is often bad mid-process.

Feb 17, 2021 04:12 PM
Rainmaker
3,943,146
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Dpwnpayment assistance programs have income limits that disqualitfy you at certain income levels.

Feb 13, 2021 04:56 AM
Rainmaker
1,152,372
Thomas J. Nelson, REALTOR ® e-Pro CRS RCS-D Vets
Big Block Realty 858.232.8722 - La Jolla, CA
& Host of Postcards From Success Podcast

I'd ask Jason E. Gordon 

Feb 12, 2021 06:19 PM
Rainmaker
1,290,048
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Without knowing more, I'd guess that it had to do with the mortgage program they were applying for.  There are income "caps" on some mortgage programs.  The increase in pay could have pushed them over the limit for that program. 

Moving forward may have been impossible within another program possibly (?) ... and again, without knowing more details, I'm just guessing that was the issue.  There are many asterisks and rules that apply to specific mortgage programs, etc.

Hope that helps ... but if you have further questions, shout ...

Gene

 

Feb 18, 2021 12:36 PM
Rainmaker
2,004,526
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

Good Question

Feb 13, 2021 04:21 AM