Pregnant and Buying a Home?

By
Real Estate Agent with 8z Real Estate CalBRE# 01830950

I learned something new today that I thought I would pass on to others.  If one of the buyers is on maternity leave, there are some lenders who will not count that person's income when it comes to qualifying for a loan.  The apparent rationale is that there is a probability that after having a baby, the mother might end up not returning to work and hence, will not have that income any more to help pay for the mortgage.  Just something to keep in mind if you (or a client) are getting ready to have a baby and buy a home around the same time.  Not sure if this applies to all areas and lenders, so be sure to check with your loan agent or mortgage broker.

Comments (6)

Jennifer Fivelsdal
JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571 - Rhinebeck, NY
Mid Hudson Valley real estate connection

Jean - Wow! is that legal if the person has a job and is allowed maternity leave? seems like some sort of a discrimination against childbearing women.

Feb 16, 2009 03:57 PM
Corey & Erika Kahler
The Cascade Team - Kirkland, WA

That is very surprising and seems rather unfair.  Great info!  Thanks!

Feb 16, 2009 05:54 PM
Jean Joh
8z Real Estate - Millbrae, CA
SF Peninsula RE Specialist

I was surprised as well and not sure what to make of it.  I can understand the rationale, I guess, but on the other hand, my client is pretty sure that she's going to go back to work after the baby.  I'm not sure if it's the lender's prerogative to predict the future and act accordingly.  How would it be if they stopped lending to people just b/c the company they work for MIGHT have layoffs in the coming months?

Feb 17, 2009 02:59 AM
Anonymous
Ray

I just ran in to this same problem. We were prequalified by Countrywide. We finally found a home we liked so we opened escrow. Two weeks in escrow and my wife takes maternity leave (twins) and now we don't qualify. We already paid for home inspection and appraisal. So now we lose that money. This just isn't fair. She is still receiving partial pay and getting the disability compensation. We have letters from her employer stating that she is still employed. We gave them a copy of the doctors orders, but all they say is that "she isn't working". How can this be legal ?

 

Ray

Mar 09, 2009 05:25 PM
#4
Jean Joh
8z Real Estate - Millbrae, CA
SF Peninsula RE Specialist

Hi Ray, Sorry to hear about your situation.  For my clients, their mortgage broker was actually able to find one lender who would be willing to give them a loan, provided they had a letter from the wife saying that she was going back to work on such-and-such date, as well as a letter from the employer stating the same.  You may want to ask your loan agent to look into some different options for you.  Or, if you have only been working with Countrywide, perhaps consider contacting a loan broker who can do some research into other lenders for you. 

Not sure about how all this works in terms of legal concerns (some might even ask if this could be considered discrimination), but apparently, banks have statistics that show that many women end up not going back to work after they have their babies.  Personally, I would think that it should be up to the families to decide if they can afford a mortgage on only one income, but on the other hand, I understand that lenders' desires to minimize risk of more people defaulting. 

If you would like some contact information for the mortgage brokers I have worked with, please feel free to contact me.  And more than anything, congratulations on the coming additions to your family!  I hope all goes well with you.  Jean

Mar 10, 2009 06:43 PM
Martha Brown
Long & Foster Real Estate, Inc., Annapolis MD 21403 - Annapolis, MD
Your Homes Around Annapolis Agent

jean- not surprised to hear it was Countrywide that gave Ray the boot. As far as the maternity leave thing in general I have not had that scenario but I am surely going to ask the lenders I know if this is the 'new' thing. Thanks for the heads up.

May 03, 2009 02:18 PM