Mortgage  Question?
Apply for Mortgage Before or After Move to New State?

I am moving to a new state and want to buy a home. Should I apply for a mortgage before or after I move?

Michael Jensen, Mortgage and Finance Guru
, Mortgage and Finance Guru

You have two options for buying the home if you plan to move to new state. Your first option is to buy the home before you move to the new state. In that case the lender uses your current employment and income when you apply for the mortgage. The downside to this scenario is that you must be able to afford both the monthly payment on your current residence as well as the mortgage payment, property tax and insurance on the home you buy. Additionally, with this scenario the home you buy in the new state is technically considered a second home which means you may pay a slightly higher mortgage rate.

Your second option is to wait until you move to the new state to purchase the home. In this case, most lenders require that you have already started your new job before you can qualify for a mortgage so it likely makes sense for you to establish employment and residency in the new state before you apply for the mortgage.  Additionally, if your new job has a probationary or trial period, most lenders wait until the the probationary period is over to qualify you for a mortgage. The positive of this scenario is that you are only required to afford the monthly housing expense on the home you purchase in the new state, which makes it easier to qualify for a mortgage. Additionally, the home you purchase is considered your primary residence which means your mortgage rate is lower than the rate on a second home.

You can use our Mortgage Qualification Calculator to determine what size loan you can afford based on your monthly gross income, debt expense and interest rate.

Finally, we always recommend that borrowers contact multiple lenders to understand how they would handle your unique situation. You can review lenders in your area by clicking INTEREST RATES We advise you to contact at least four lenders as shopping lenders is the best way to save money on your mortgage. You can also use our Personalized Mortgage Quote function to receive no obligation mortgage quotes from up to four lenders.

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About the author

Michael Jensen, Mortgage and Finance Guru

Michael is the co-founder of FREEandCLEAR. Michael possesses extensive knowledge about mortgages and finance and has been writing about mortgages for nearly a decade. His work has been featured in leading national and industry publications. More about Michael

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