“If I work a couple of part-time jobs, can I apply for a home loan now or do I need full-time employment first?”

You can use either part-time or seasonal income toward your loan qualification if your lender can document that you have worked your part-time job uninterrupted for the past two years and that the income stream continues as such going forward. Since there are many families that rely on part-time and seasonal income for their day-to-day needs, your lender should not restrict the consideration of this type of income when it comes time to apply for a home loan.

For qualifying purposes, part-time income refers to employment taken to supplement a borrower’s regular employment income source. Typically, part-time employment is not a primary job, and it is worked less than 40 hours per week. Therefore, your lender has specific guidelines that must be met in order for this type of income to be usable.

For example, with most lenders, there should be acceptable evidence that your part-time income has been received for at least 24 consecutive months prior to the time of your application. Although you may be able to use part-time income received for less than 18 months if your lender can justify it’s in conjunction with your primary employment and document that the income is likely to continue. Any part-time income not meeting these types of qualifying requirements may not be used in qualifying.

Similarly, any income you might receive from seasonal employment could be used to help you obtain financing for a home too. As long as the seasonal income is considered stable and uninterrupted, it may be used in your loan application as effective income for qualification purposes. Your lender will need to validate that you have worked the same seasonal position for the past two years and that there is a high probability of being rehired again for the next season. Otherwise, the income will not be eligible.

Additionally, if your primary employment is generating less than the standard 40 hours of work per week, then you should be able to leverage this income as well. To do such, your lender would need to evaluate the stability of that income as being regular, ongoing primary employment with the likelihood of it continuing in that manner. Therefore, even if your job is less than the common 40-hour work week, as long as it’s a properly documented primary source of employment, it should be considered effective income for your lender to use in determining your loan eligibility.

Regardless, it’s always a good idea to share all of your sources of income with your lender, whether they are part-time, seasonal or new. There’s a lot to consider when your lender interprets these types of income sources. Should any of them be disallowed by your lender, they might still end up carrying a little weight as a compensating factor which could make the difference when your lender is making a final decision on your loan approval.

Chris Salese can be reached at chris@delsurmortgage.com or (707) 363-4439. He is a licensed California mortgage banker (NMLS 254469/1850 CA BRE 01377933/01215943) and equal housing lender.

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