Underwriting and working for family

[cdc515]

I am in process of getting mortgage and I wanted to know that since I work for a family member would that be a problem? Would I be denied because I work for family? The underwriter has specifically asked if I own or work for family.

 

 

Should I just tell the UW that I do not or should I tell them I do? How can they verify I work for family anyway?

 

Let me know what you guys think.

Edited June 19, 2013 by cdc515

[jop3]

Tell the truth. You will not be denied for working for family. They just may do additional verification, that's all. Just a couple extra hoops. As long as you fully dislcose everything, it will all turn out fine.

[DallasLoanGuy]

agree with above 100%

[cdc515]

Would this matter if during the past year I got a $60K raise about 6 months ago. This is all legit but they may see it as not.

[jop3]

Yeah, that's fishy. It's a case by case basis with the underwriter. It has to make sense. If the underwriter thinks that you were given the raise only to qualify for the mortgage, there may be a problem. A 60k raise just isn't normal, so you'll have to be able to document that it's legit.

[cdc515]

I understand it sounds fishy but it is actually legit.

 

I was promoted to a better position and it came with a big pay raise. It is just bad timing I guess.

[Brian B The Loan Professor]

I understand it sounds fishy but it is actually legit.

 

I was promoted to a better position and it came with a big pay raise. It is just bad timing I guess.

be prepared to write a solid letter explaining what you have shared here, The promotion and raise shouldnt be an issue - if it is can you qualify based on the previous income?

[cdc515]

I will not qualify based on the previous income.

 

They have given me a mortgage commitment with conditions and one of the conditions was to have HR write a letter to explain the huge increase in salary and to confirm I do not have ownership in the company and that no family has ownership in the company.

 

What would happen if I just said I confirm that nobody in my family owns it? How would they check and verify?

[Brian B The Loan Professor]

Is it going to be an issue for HR to draft that letter? Sounds like thats all they need.

[cdc515]

I don't see it being a problem at all for the letter.

 

The thing that concerns me is they specifically asked me to confirm that no one in my family owns the business, which they do. (I am afraid if I say yes I do work for family they will say okay LOAN DENIED!! Why else would they have asked me to confirm that.

Why would they even care if someone in my family owns the business.

[jop3]

Again, tell the truth. If you don't, it's mortgage fraud. You really, really don't want to go there.

 

Your loan will not be denied just because family owns the business. They just might want additional documentation. Quickly give them what they are asking for so you can find out what other questions they might have.

[Brian B The Loan Professor]

I don't see it being a problem at all for the letter.

 

The thing that concerns me is they specifically asked me to confirm that no one in my family owns the business, which they do. (I am afraid if I say yes I do work for family they will say okay LOAN DENIED!! Why else would they have asked me to confirm that.

 

Why would they even care if someone in my family owns the business.

 

 

They are concerned that you are partial owner which would make you self employed. This would cause them to have to look at your income differently. I agree with Danielle - be honest and work through things....

[750orDie]

My husband works for his family, so when we were in underwriting it was a bit of a pain. They required copies of the business ownership paperwork from my father in lawys attorney and also copies of their state business licenses. We also had to write a letter of explination stating that my husband doesn't own any part of the company. It didn't stop us from getting our mortgage, it just added to the paperwork involved that's all. Good luck!! Hope that helps.