Between the pre-approval and the closing table, a lender checks your job twice: once when the loan is approved and again in the last days before you sign. A new job that comes up between those two checks isn't a problem by itself. What causes trouble is a change the lender only learns about on the final check, when there's no time left to document it.
Which job changes are routine and which take time
| The change | What the lender needs | What usually happens |
|---|---|---|
| Same field, salary or hourly, equal or higher pay | Signed offer letter with pay and start date, then the first pay stub | Little or no effect. Closing may wait a few days for the first stub |
| Same field, lower pay | The same paperwork | The lender reruns your ratios on the new pay |
| Salary or hourly to commission | A history of commission earnings, often 12 to 24 months | The commission usually can't count yet |
| Employee to self-employed | Usually two years of tax returns from the business | Not usable until that history exists |
| Leaving a job before a new one starts | Signed offer letter for the new job, then the first pay stub | Most loans wait for that first stub, though a Conventional purchase can sometimes close on the offer letter |
The programs look at your two-year work history rather than time with one employer. FHA, VA and USDA all review two years of employment, with any number of employers. Fannie Mae sets no minimum time on the job for fixed salary or hourly pay. The new job page covers buying with a job you started before you applied.
A worked example: a pay cut that still works
Dev is under contract on a $260,000 home with FHA at 3.5% down and a 5.75% rate on a 30-year fixed, with taxes at about 0.90% of the price a year and insurance at $283 a month. He has $400 a month in other debts.
| Monthly payment piece | Amount |
|---|---|
| Principal and interest | $1,489.81 |
| FHA monthly mortgage insurance | $115.00 |
| Property taxes | $195.00 |
| Homeowners insurance | $283.00 |
| Total housing payment | $2,082.81 |
Two weeks before closing, Dev gets an offer at another company: $54,000 a year in place of his $58,000, with better hours and a shorter commute. He calls the lender before he accepts, and the lender runs both jobs:
| Current job | New job | Commission job with $2,800 base | |
|---|---|---|---|
| Monthly income counted | $4,833.33 | $4,500.00 | $2,800.00 |
| Housing ratio | 43.09% | 46.28% | 74.39% |
| Total ratio | 51.37% | 55.17% | 88.67% |
| Inside FHA's 46.9% and 56.9% | Yes | Yes | No |
The salaried job at $54,000 still clears FHA's automated limits, so Dev can take it. He sends the signed offer letter and his first pay stub, and the lender verifies the new job before closing. On a Conventional loan, with a 50% limit on total debts, the 55.17% ratio would not work, which is one reason the program named on your approval matters.
The third column shows why a move to commission is the hard one. Only the $2,800 base counts until the commission has a track record, and the ratios jump far past every program's limits.
How to change jobs without derailing the closing
- Call your lender before you accept. We can run the new pay against your approval in a few minutes and tell you whether anything changes.
- Get a signed offer letter. It should show the employer, the position, the pay and the start date.
- Keep the same kind of pay if you can. Salary to salary or hourly to hourly is the easiest move to document.
- Think about the start date. When the new job can begin after closing, your current job carries the loan to the finish and the switch needs no paperwork at all.
- Send the first pay stub the day you get it. That's usually the last piece the underwriter needs.
If the new pay lowers your approval, there are fixes: paying off a small debt, adding a co-borrower whose income counts with yours, or moving a Conventional approval to FHA, whose ratio limits run higher.
Enter the new salary in the affordability calculator to see how it moves your price. Before you sign anything with the new employer, call AAA Capital Funding at 888-601-8344, and we'll tell you exactly what the change does to your loan and your closing date.