The coronavirus has undoubtedly created a significant amount of challenges for mortgage companies and families across America. Some lenders are changing credit score requirements, others are pulling out of the market entirely, and others are making restrictions on what types of loans they will fund. If you are in the process of getting a mortgage right now or will be and you are going to get furloughed, here’s what you need to understand and know the best navigate through the world of mortgage financing.

Most mortgage companies are going to require you to have an ample supply of documentable income, sufficient credit, and good money in the bank or good equity in the house depending on if you’re purchasing or refinancing a home. In order to be successful in securing mortgage financing, you must be able to support all three. If your income is consistent and is remaining unchanged through the COVID-19 pandemic then you have nothing to worry about regardless of whether you’re working from home or not.

If however you’ve been furloughed and you are receiving no income and you have a return-to-work start date your mortgage loan would have to get placed on hold until you have an income stream again. However, there is another channel that could be a possibility for you depending on the lender that you’re working with and what your individual situation is like. If you find yourself in the situation with your employer where you have been furloughed, you have a return-to-work start date and you’re receiving the income you can potentially still secure mortgage loan financing without disruption to your mortgage or escrow process.

If you have been furloughed and you can get a written confirmation from your employer you’ll be paid for at least two weeks or longer, and you have 6 months of mortgage payments saved in the bank and you are still receiving income during the temporary shutdown your loan will still go through successfully to meet your targeted refinance close of escrow date or your purchase loan close of escrow date. Please understand not every mortgage company is going to take such an aggressive stance. Some mortgage companies are getting much more particular in fact some big companies out there, are taking the position that they will not fund your loan if your business that you are in is deemed non-essential.
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It is critical that you have a conversation like this with the lender that you’re working with presently or the one that you’re going to be working with so you can best position you and your family and for successfully securing mortgage financing during the coronavirus pandemic.

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