Pregnant Pause

Attention expectant parents: don't expect to have a baby shower and a house-warming party at the same time.

As you may have heard, banks are getting finicky with their lending, as even a flawless financial record seems suspect these days.

So, it would make sense that the next step to figuring out if you can really afford that mortgage is to see if there will be more mouths to feed at the kitchen table.

As the New York Times reported yesterday, banks are taking a pregnant pause when considering mortgage loans to pregnant couples.

It's a harsh reality and the banks aren't taking any chances. Kids cost cash. Maternity leave may not be counted as a full-time employment and is often considered short-term "disability" leave.

Fannie and Freddie guidelines allow for borrowers to simply get a note from their employer and doctor stating when they will be back to work, but of course, banks are naturally "picking and choosing what parts of the Freddie and Fannie guidelines they want to use and how they will interpret them."

So, now they are preventing you from getting your new crib just because you are getting a new crib.

And, while it's true that it makes sense financially for banks to try to eliminate as much risk as possible for a loan (in some parts of Europe, a borrower has to take a health exam; after all, if you're dead, you can't pay your loan back), for an industry that not too long ago approved NINA (No Income, No Asset) loans, this reeks of throwing out the baby with the bathwater.

Not to mention hypocrisy.

Of course, if you do happen to get your loan turned down because you are having a baby, it may be a great first-lesson to your child: banks are not your friends.