Maternity Leave and Buying a Home Don’t Lose Out!

Recently I had clients who wanted to purchase their first home. They were expecting a baby and wanted to greet their newborn in a place of their own. All their dreams could be summed up with pictures on Pinterest of babies rooms. We were all excited to make it happen!

They found the perfect property. It was close to their family so that they could watch the baby. They wrote an offer immediately. With stars in their eyes they had a sleepless night waiting to hear back from the seller. The next day, I congratulated them. Their offer was accepted. They were buying a home!

A week into the process we realized that there was a possibility that this sale wouldn’t close before the baby was going to join them. That meant that my client, this cute expectant mother was going to take maternity leave sooner than we expected. You’d think that it wouldn’t have been a problem. They had plenty of money in the bank for their down payment and savings. She was only going to be off work for six weeks and her employer said that her job was guaranteed. So, what was the problem?

Well, the Federal Housing Administration (FHA) is using a rule from 1978 that says that anyone who is on unpaid leave cannot qualify for a loan. The amount of money she was missing in pay was miniscule compared to the amount they had in savings, but this didn’t matter. She didn’t have any income. They were not going to get their loan until she was back to work. With dashed dreams, we canceled the contract and scheduled to go and look at other properties after she went back to work.

I however, was furious about it. The more I thought about this scenario the more I thought that it was discriminatory. Seriously, a rule from 1978. Maybe this needed to be looked at again. But how was I going to make a difference. How can we change federal laws? I contacted my Utah State Representative, Paul Ray and brought the issue to his attention. He scheduled a meeting with the HUD Secretary to discuss this rule. It won’t help my current clients, but it is experiences like these that show reasons to change the outdated system.

If you are thinking about buying a house and are planning on taking any maternity leave, let’s talk. I don’t want you to have the same heartbreaking experience that my clients had. Look early, because you never know if you’ll end up needing to deliver suddenly and start your maternity leave earlier than expected. Finding a home to bring a newborn baby home to is exciting- let’s work together to do it without any other surprises!