Can You Refinance Your Mortgage If You Are Unemployed?

Applying for a mortgage can be particularly stressful for self-employed or seasonal workers, and worse for those who are currently unemployed. 

When assessing a home loan application, mortgage lenders prefer simple employment verification because it is less problematic than other sorts of work.

This, therefore, highlights the question, “can you refinance a mortgage without a job?”

The answer is YES. If you are unemployed, you can refinance your mortgage, but you’ll face additional hurdles. 

You can also do a few things to boost your odds.

THINGS TO CONSIDER

• Your unemployment benefits aren’t taken into account.
• Length of unemployment matters. 
• It’s possible that refinancing isn’t the best option.
• Refinancing is not a free service.

HOW TO REFINANCE YOUR MORTGAGE WITHOUT A JOB

It is not impossible to get a mortgage or refinance one while you’re unemployed, but it will take some more hard work and imagination to meet the typical refinancing standards. Here are some tips on how to go about it;

• • Seek the advice of a housing counselor: If you are not sure where to begin, speaking with a professional about what you’ll need to receive or refinancing your loan is a good place to start.
  • Find a Co-Signatory: Obtaining a mortgage co-signer can significantly increase your chances of being approved for a mortgage or refinance even if you do not have a source of income.
  • Increase the amount of money you put down: While lenders like to see proof of income, they recognize that a borrower’s lack of a job does not automatically imply that they would be unable to make their monthly mortgage payments. You may be able to be accepted with an excellent credit score and history if you have saved or investment assets and can make a greater down payment to alleviate lender concerns about your lack of income.
  • Mortgage with No Income Verification: A non-qualifying mortgage does not require proof of income. These loans usually have higher interest rates than qualifying loans, but they’re easier to get approved.

NOTE:

It is not a good idea to refinance your mortgage if your unemployment circumstances are unlikely to alter. 

Refinancing a home is costly and has an impact on your credit score. 

Even if you are fortunate in finding a lender, you may find yourself in the same scenario if you are unable to find work.

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