Mortgages for Nurses on Long Island

For most nurses on Long Island, the tricky part of a mortgage is how a lender counts your pay. On a conventional loan, set hours like three 12s need no minimum time on the job. Overtime usually needs two years, or 12 months with a strong application. Per-diem shifts need 12 months. Travel stipends usually don’t count.

The rules are the same at Northwell, Stony Brook, Catholic Health, NYU Langone in Mineola or a small community hospital in Nassau or Suffolk, and for techs and aides. When I say conventional, I mean a conventional loan that follows Fannie Mae’s rules.

Three 12s and other set schedules

If you’re on staff and your employer commits to a set minimum number of hours, like three 12s a week, your pay is the easiest kind to count. Small swings in your hours from one paycheck to the next are fine.

On a conventional loan there’s no minimum time on the job for this pay, though the lender still looks at your last two years of work. The math is hourly pay × average weekly hours × 52, divided by 12. For example, at $50 an hour and 36 hours a week, that’s $7,800 a month.

If your hours can be cut with no set minimum, like on low-census days, it’s counted like per-diem pay, which needs 12 months of history.

A raise that hasn’t started yet

Got a step increase coming? If it’s a raise to your set pay, your employer confirms it, and it starts within 60 days after closing, it can count on a conventional purchase before it shows on your stub. A raise on per-diem hours has to be in place before closing.

Do overtime and shift differentials count?

Overtime can count once you have a track record of it and it looks like it’ll keep coming. Plan on two years. On a conventional loan, 12 months can be enough if the rest of your application (credit, savings, debts) is strong. If your overtime has been dropping, it has to level off before a lender will count it. FHA can count it after one steady year, using the lower of your two-year and one-year averages. VA generally wants two years.

Say you picked up $14,400 in overtime last year and $8,400 from January through June. On a conventional loan, if it’s been steady or rising, the lender would add those together and divide by 18 months. In that example, it’s about $1,267 a month on top of your base pay.

Shift differentials

A night, weekend or holiday differential that changes from check to check is usually averaged like overtime. The underwriter will also make sure your latest stub still shows it. Send me a recent stub and I’ll tell you how yours is likely to count.

Per-diem (PRN) shifts and a second job

Per-diem shifts need at least 12 months of history on a conventional loan. On FHA, varying hours are usually averaged over two years.

Staff job plus per-diem at another hospital? Plan on two years at both. On a conventional loan, 12 months can work if the rest of your application is strong, and you can’t have a gap of more than a month in the past year. FHA and VA generally want the full two years.

Can travel nurses get a mortgage?

Yes. On a conventional loan, frequent job changes are fine if your pay has stayed steady. If an agency pays you on a W-2, you’re an employee, not self-employed.

• Stipends. Housing and meal stipends, what your agency may call per diem, usually don’t count as income. They’re meant to cover expenses. Plan on qualifying on your hourly pay.
• Going back to staff. Leaving travel for a staff job at lower pay? The lender has to qualify you on the lower amount.
• Where you live. FHA is only for a home you live in most of the year. On the road for most of it? That can rule out FHA.

Paid on a 1099?

Then the IRS generally treats you as self-employed. Conventional and FHA lenders work from the profit on Schedule C of your tax returns, not your 1099 totals, so most write-offs lower the income they can count. Plan on two years of returns. One year can work if you did similar work before, say as a staff RN, and earned as much or more.

If your returns don’t show enough income, I also offer bank statement and 1099 loans, through lenders I work with. Ask me if one fits.

New grad nurses: buying on an offer letter

Lenders like to see two years of steady work, but less can work when the rest of your application is strong. On FHA, time in your nursing or tech program can count toward the two years.

Accepted an offer but haven’t started yet? On a conventional loan, the pay in your offer letter can be your income. The offer has to be final and accepted, and show your position, pay and start date.

If your offer still depends on passing boards, a background check or a health screening, all of that has to be cleared before closing. So plan to close after your license is in hand.

Want to close before your first paycheck? I work with lenders that close on an offer letter, so it can be done. Not every lender will. It works if you’re buying a one-unit home (not a two-family) to live in, you qualify on set-schedule pay alone (no per-diem or overtime), and you start within 90 days after closing. You’ll need extra savings on top of the usual cushion: six months of the full house payment, or enough to cover your monthly debts, including the new house payment, until you start, plus one more month.

These offer-letter rules are for conventional loans. If you’re leaning FHA, tell me before you go into contract on a house.

Student loans

Deferred student loans still count. On a conventional loan, the lender uses 1% of the balance or the full monthly payment on your loan paperwork. For example, $60,000 in deferred loans can count as $600 a month. On an income-driven plan with a verified $0 payment, it can count as $0.

Down payment help for nurses and hospital workers

Ask HR whether your hospital has a formal homebuyer benefit. On a conventional loan for a home you’ll live in, employer money can cover the down payment and closing costs, as a grant or a loan. On a one-unit home, none of the money has to be your own. It has to be an established employer program, paid by your employer or its affiliated credit union.

FHA also allows a gift from your employer or labor union.

There’s also private down payment help, and it isn’t just for nurses or hospital workers. See how down payment assistance works.

Separately, I offer private down payment assistance programs available through lenders I work with; they are not state, county or town programs and are not affiliated with or endorsed by any government agency. Terms, eligibility and availability vary by program and lender, are subject to credit, income, property and underwriting guidelines, and can change or end without notice; not everyone will qualify.

Documents you’ll want

My mortgage document checklist has the full list for W-2 pay. On top of that, have these ready:

• W-2s for the last two years from every hospital or agency whose pay you want counted.
• Your accepted offer letter, if you’re starting a new job.
• Your latest student loan statement.
• An HR or payroll contact. The lender checks your job again within 10 business days before closing, so call me before you change units, cut hours or switch employers.

Which loan fits, and where I come in

Your job doesn’t pick the loan. Your credit, savings and pay history do. The usual choices are conventional, FHA, and VA if you’ve served. Credit needs work? See my guide to buying with a low credit score. First home? Start with my first-time buyer guide. Or see all my loan programs.

One Long Island thing to watch: property taxes. The lender counts them in your monthly payment, and two houses at the same price can have very different tax bills. Run the tax bill through my affordability calculator before you fall in love with a listing.

I’m a mortgage loan originator at Scott Capital Group. I compare options from the lenders I work with, and your loan comes from the lender you pick. Text me at 631-250-6930 with your schedule and how you’re paid, or send a note.

Frequently asked questions