What happens if you lose your job before closing?
A job loss at any time can be stressful, but a job loss after you've entered into a legally binding contract to buy a home? Yikes! So what should you if you find yourself in this situation?
The first thing you should do is let your mortgage broker or banker know. You may think keeping this to yourself maybe the best approach however lenders confirm your employment and income status before approving you, and some again prior to closing.
You also have an obligation to notify your lender about ALL changes to your employment and income, if you don't disclose this information you maybe committing mortgage fraud.
Your lender may decide to continue with your application, depending if your job loss is momentarily or permanentley. If you have new employment lined up most lenders will need to requalify the loan at your new wage (especially if it's lower) and they will require a paystub from your new job before they can fund the mortgage.
If your job loss is not temporary but your application is joint with someone they may still qualify to buy the home without your income. If they can not then we would look at bringing on co signors to help you out temporarily.
Many times there are solutions to these problems, but the most important things is bringing these problems to attention as soon as they arise.