Making purchases such as furniture or purchasing/leasing a new car adds to your monthly debt and increases your Debt-to Income ratio. The DTI ratio that the lender is using to evaluate you is the one at the point of application when they first compared your income to your existing debt. In some cases, you may have increased the DTI past the threshold for the loan program. 4. Don’t Change Jobs or How You Receive Income Showing consistent and stable employment is an essential part of the process of obtaining a loan. Job changes can create problems, especially if your income structure changes. For example, you were a salaried worker who has taken a position with a lower base pay because it offers the possibility of bonuses or commissions. Since you don’t have a prior history of having received commission or bonuses they cannot be counted as income. It is generally recommended that you have a history of continuous employment of at least two years with the same or employer or at the very least in the same industry. However, consider that: If you are a quality assurance tech in a pharmaceutical firm and you move to another pharma for increased pay or an opportunity for advancement you are not likely to be disturbing your continuity of employment. If you move into a new field, from being a pharmaceutical tech to managing a Staples store for example, you may need to work two years in the new industry before you qualify. Switching to self-employment also poses a challenge. If you had been an employee drawing a regular wage and now have started a new business, you have disrupted the continuity of pay. Even if your new business is in the same field as your previous
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