How to Refinance Without a Job
Mortgage lenders do not require a job to refinance a mortgage. Mortgage lenders do require a steady source of income. This steady source of income may originate from many different places other than employment. Mortgage lenders allow homeowners with social Security, retirement, disability, interest and dividend income and passive sources of income to refinance without having or maintaining a job. Unfortunately, mortgage lenders typically reject unemployment income as a steady source of income.
Other People Are Reading
Instructions
-
-
1
Explain to your loan officer the different sources of your income. Many homeowners qualify with nonemployment income that they receive from multiple sources. Your loan officer needs to know what type of income you receive, so he can document it appropriately. Typically, mortgage lenders require a two-year history of receiving the nonemployment income and proof it will continue or is likely to continue for the next three years.
-
2
Give your nonemployment income documentation to your mortgage loan officer. If your income is from social security or retirement, provide your loan officer with the most recent year's award letters. If your income derives from interest and dividend or other types of passive income, provide your loan officer with two years of tax returns. If your receive income from alimony or child support, provide your lender with the divorce decree that documents the amount of income ordered and how long it continues. The lender may require documented proof you received the income consistently for the past two years.
-
-
3
Write clarifying letters of explanation for any unusual or complicated income sources. Since nonemployment income encompasses many different types of income, these situations often require the homeowner provide an explanation letter that helps the lender understand and accept the income. Depending upon the complexity of the income sources, the lender may request additional income documentation. Sometimes frustration sets in when lenders ask for additional documentation. Lenders usually ask for more documents as they attempt to approve the loan, not when they intend to decline the loan.
-
1
Tips & Warnings
Find a loan officer with experience working with nonemployment sources of income. These loans typically require more experience than do loans with employed borrowers. When interviewing your loan officer ask about nonemployment loans closed in the past year. Consider this when choosing a loan officer to provide you a mortgage.
