Does what type of job you have affect your ability to qualify for a mortgage? I am deciding between a steady government job and a higher paying private sector job and want to understand if my job impacts my mortgage application.
As long as you are not self-employed and meet the lender's employment history requirement, lenders do not differentiate what type of employer you work for when you apply for a mortgage. We provide a comprehensive overview of the employment history requirement for a mortgage on FREEandCLEAR for you to review.
In short, working for a stable employer like a government agency does not provide an advantage when you apply for a mortgage as compared to working for a private sector company. Lenders are more focused on the length of your current employment, employment history, income level and type of compensation. The only time working for the private sector versus the public sector becomes an issue is if your compensation is structured differently. For example, if you have a private sector job and earn a significant portion of your compensation from a bonus or commissions, that income may be treated differently than salary income or hourly wages, depending on your income history. Lenders treat salary income and hourly wages the same regardless of the type of employer.
Simply put, the more money you earn, the higher the mortgage amount you qualify for. A higher paying job may also help you save for a down payment faster. You can use our Mortgage Qualification Calculator to determine what size mortgage you can afford based on your monthly gross income, debt expense and interest rate.
Please note that lenders apply a different set of qualification guidelines to self-employed borrowers and we provide a detailed explanation of How to Get a Mortgage If You are Self-Employed. In short, getting a mortgage if you are self-employed is certainly possible but it requires some extra work by borrowers and additional documentation.
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