Can I Get a Mortgage If I Just Started a New Job?
Key Takeaways
- You typically need a two-year work history, but you don’t need two years with the same employer.
- You can qualify with less than two years of employment if you show steady income in the same field, recent education related to your job, or a strong offer letter.
- Your likelihood of approval increases with a good credit score, favorable debt-to-income ratio, and adequate savings.
Verify your home buying eligibility. Start here
“Can I get a mortgage if I just started a new job and don’t have a long job history?” is a question many people ask, and the answer can vary.
While mortgage lenders often prefer applicants to have two years of job history, it’s not a strict requirement for everyone. The specific employment criteria you’ll need to meet can differ depending on both the lender and the type of mortgage you’re interested in.
There are plenty of scenarios where a two-year job history isn’t realistic. Fortunately, lenders understand this. And they have rules to help applicants just starting a new job.
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How long do you have to be employed to buy a house?
As a rule of thumb, mortgage lenders require two years of employment to qualify for a home loan. Your job history is just one of several criteria underwriters will check when you buy a home or refinance an existing mortgage. Your credit score, debt-to-income ratio (DTI), and down payment matter a lot, too. While a career change or a shorter job history can present challenges to homeownership, it’s an obstacle you should be able to overcome, especially if your loan application is otherwise solid.
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Can I get a mortgage if I just started a new job?
Yes, you might be able to get a mortgage even if you’ve just started a new job, even with a short work history. However, your chances depend on several factors, primarily the industry you’re in. Typically, mortgage lenders look at your employment over the past two years, but this doesn’t necessarily mean you’ve had to stay in the same job during that time.
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You can usually qualify with two years of steady work in the same field, even if you changed employers.
Example: if you were a staff accountant in the software industry, and changed jobs to be a staff accountant in the medical field, that would be considered an acceptable lateral move by a lender
You may qualify with a non-traditional job history if your income shows stability and stays within the same field.
Example: Suppose you spent the last four years completing an accounting degree and worked a couple of temporary accounting jobs during the summer. Upon graduation, you got a full-time accounting position. The fact that you’d been working full-time for only one year probably won’t hurt your mortgage loan approval chances. In fact, if you’re working in the same field you studied, your education itself might count as a two-year job history
You may not qualify if you move often between unrelated jobs or industries, even with many years of work history.
Example: You have a 10-year employment history. But you spent a year as an accountant, switched to bartending for a couple of years, then to marketing, and now you’re a personal trainer with six months in the business. All these career changes may raise a red flag for a lender. They may require a letter of explanation
How to get a mortgage if you just started a new job
If you’ve just started a new job and want to apply for a mortgage with a less than two-year job history, there are a few things you can do to improve your chances of approval:
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- Shop around for lenders. Not all mortgage lenders have the same requirements for new job applicants, so it’s important to shop around and find a lender that is willing to work with you
- Build up your savings. A healthy savings account can show lenders that you have a cushion to fall back on if your income fluctuates. Additionally, having savings can help cover the down payment and closing costs associated with buying a home
- Check your credit score. A good credit score can improve your chances of approval for a mortgage. Check your credit report and take steps to raise your FICO score, such as paying down debt and making on-time payments
- Provide additional documentation. Lenders may require additional documentation to verify your income and employment stability, such as a job offer letter or employment contract. Be prepared to provide this documentation when you apply for a mortgage
- Consider a co-signer. If you’re having difficulty getting approved for a mortgage on your own, you may want to consider having a co-signer with a stable income and good credit to help you qualify
Overall, it’s important to be upfront with your mortgage lender about your job history and to provide any additional documentation they may need to assess your financial stability. Working with a mortgage specialist or financial advisor can also help you navigate the process and find the best mortgage option for your individual circumstances.
How to get a mortgage without two year’s job history
When you apply for a mortgage, the lender wants to know that you can and will repay your new home loan. This is why mortgage companies check your credit history and income. Your credit rating represents your willingness to repay. Your income shows your ability to repay.
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Mortgage lenders understand that someone without a two-year job history might still be perfectly willing and able to repay a mortgage.
That’s why there are workarounds to the two-year employment rule for qualified applicants:
- You can get a mortgage even if you’re just starting your career. You don’t always need decades of work experience to get mortgage approval. Sometimes, a lender will approve you on the strength of a job offer alone. Especially for high-earning positions like physicians and lawyers
- If you’re in-between jobs, you might still get approved for a mortgage. Lenders can approve home loans based on an offer letter for people between jobs or starting at a new company when they move. Having at least one payslip helps, too
- You don’t need two years of conventional employment to get a mortgage. Many lenders will consider alternative income information for self-employed, entrepreneurs, contractors, or gig workers
- You might qualify with compensating factors. Lenders may approve your mortgage without a two-year employment history if you have strong compensating factors, such as a large down payment, excellent credit score, low debt-to-income ratio, significant savings or assets.
You can get a mortgage if you just started a new job. But the trick is finding a lender willing to work with you.
What to do when changing jobs while buying a house
Changing jobs while buying a house might not be ideal timing, but it doesn’t necessarily spell disaster for your mortgage application. There are several steps you can take to reassure your lender and improve your chances of loan approval.
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Get a letter from your new employer
Firstly, an employment letter from your new employer can go a long way. This letter should outline your start date, the role you’ll be taking on, and your salary. This basic information can often satisfy a lender’s initial concerns about your job change.
You may need a Verification of Employment
However, some lenders might want more than just a letter; they may request a Verification of Employment (VOE). This is a more formal process that could involve either a phone call or written confirmation from your new employer, sometimes even stating that they expect your employment to be ongoing.
Provide pay stubs from the new job
If you’ve already started your new job by the time you’re deep into the mortgage process, providing a recent pay stub can offer additional proof of stable employment and income. This can be especially helpful if your new job comes with a pay increase, as it shows you’re in an even better position to handle your mortgage payments.
Regardless of job changes, maintaining a strong credit score and a low debt-to-income ratio will always work in your favor when applying for a mortgage. These factors help paint you as a low-risk borrower, which can be particularly reassuring to lenders if you’re in the midst of a career transition.
Job history requirements by mortgage loan type
Each mortgage loan program has its own requirements when it comes to employment history. If you’re on the edge of qualifying based on your job history, it’s worth looking into different kinds of mortgages to see which one suits you best.
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The following is a breakdown of how long you must be at a job to qualify for each major loan type.
| Loan Type | Job History Requirement |
| Conventional loan | Two years of related history. Need to be at current job for six months if applicant has employment gaps |
| FHA loan | Two years of related history. Need to be at current job for six months if applicant has employment gaps |
| VA loan | Two years or relevant schooling or military service. If active military, must be more than 12 months from release date |
| USDA loan | No minimum in current position. But prove two years of work or related job history |
Conventional loan employment rules
FHA loan employment rules
VA loan employment rules
USDA loan employment rules
Can you get a mortgage without a job?
To approve you for a mortgage, lenders need to know you have enough income to comfortably make the loan’s monthly payments. This can make it challenging to get a mortgage without a job.
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Here are a few strategies worth looking into if you’re currently out of work:
- Qualify based on an offer letter for a new job: As we mentioned above, it’s possible to get a mortgage if you’re currently out of work, but starting a new position soon. Many lenders will approve you based on an offer letter and verification of employment from your future employer
- Qualify based on a partner or spouse’s employment: If you’re unemployed but buying a house with a partner or spouse, you might qualify for a mortgage based on that person’s income and credit alone
- Qualify based on your assets: If you have significant assets, you might qualify for an “asset depletion mortgage.” This type of loan assumes you’ll make payments by selling or liquidating those assets over time
- Qualify with investment income: Lenders may qualify you for a mortgage based on dividend and interest payments from investments you own. But these will need to be significant if they’re your only source of income for qualification. Learn more here
- Qualify with disability benefits: With many lenders, you can use income from a long-term disability insurance policy or Social Security Disability Insurance (SSDI) benefits. You must show the income will continue for at least three more years
- Qualify with alternative income: Other income sources that can potentially help you qualify for a mortgage include pension and Social Security income, annuity income, and alimony payments
As always, the rules vary by lender. If you’re currently unemployed, your chances of getting a mortgage will depend heavily on your unique situation.
Your best bet? Chat with a few different lenders to understand your options and what you need to do to qualify for a home loan. Also, look for a mortgage broker specializing in finding home loans for unique buyers. Their local real estate market knowledge could help you quickly identify financing options for your situation.
Can you qualify for a mortgage with unemployment income?
In most cases, unemployment income cannot be used to qualify for a mortgage. If you were laid off and just started receiving unemployment, you’ll have to wait until you start a new job — or at least have an offer letter in hand — to buy a house.
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The only exception to this rule is for seasonal workers who have a regular history of receiving unemployment.
For example:
- You’re a contract worker who works six months each year and earns $90,000
- You receive unemployment income for the other six months of the year
- You have maintained this same schedule and income level for at least two years
- A lender might approve you based on your regular income and unemployment income combined, using the average yearly income over the past two or more years
However, this is a rare scenario restricted to seasonal workers. In almost every other case, unemployment income will not help you qualify for a mortgage.
How much income do you need for a mortgage?
You need enough verified monthly income to cover your new mortgage payment and existing debts while staying within your lender’s debt-to-income (DTI) limits. Most lenders cap DTI around 43–45%, which means your total monthly obligations—including the mortgage, taxes, insurance, and other debts—must not exceed that percentage of your gross monthly income. The exact income requirement depends on factors like the home price, interest rate, loan type, down payment, and your existing debts, which is why two borrowers buying the same home can have very different income needs.
Here’s how most lenders view different types of income when it comes to mortgage qualifying:
| Type of Income | Years History Required |
| Salary | Can use the full amount immediately, with an offer letter or first pay stub |
| Bonus | Two years’ history required |
| Commission | Two years’ history required if more than 25% of income |
| Overtime | Lender will average two years’ overtime earnings |
| Hourly | Preferably, two years’ average will be used if hours fluctuate |
| Second job | Two years’ history of working both jobs simultaneously |
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How is salary calculated for a mortgage?
Lenders view salary as the simplest income type, but timing still matters. They usually divide your annual gross salary (before tax) by 12 to determine your qualifying monthly income, and they may approve you with an offer letter or first pay stub if the role requires specific training or experience.
How are bonuses calculated for a mortgage?
Lenders calculate income with bonuses in two parts. They divide your annual salary by 12 to determine your base monthly income, then assess bonus income separately. Lenders count bonus income only after you provide at least two years of receipts and your employer confirms the bonus will continue. Underwriters average the last two years of bonus earnings over 24 months to determine a monthly amount, but they reduce or exclude the bonus when it declines year over year, since they qualify borrowers based on the most conservative scenario.
How is hourly income calculated for a mortgage?
Hourly income is calculated based on how consistent your work hours are over time. Lenders multiply your hourly rate by your average weekly hours, then annualize that amount and convert it to a monthly figure, often using a two-year average when hours fluctuate.
The table below shows Fannie Mae’s guide to income calculations.
| How Often Paid | How to Determine Monthly Income |
| Annually | Annual gross pay / 12 months |
| Monthly | Use monthly gross payment amount |
| Twice Monthly | Twice monthly gross pay x 2 pay periods |
| Biweekly | Biweekly pay x 26 pay periods / 12 months |
| Weekly | Weekly pay x 52 pay periods / 12 months |
| Hourly | Hourly pay x average number of hours per week x 52 weeks / 12 months |
How is overtime pay calculated for a mortgage?
Lenders calculate overtime income by adding up your overtime pay from the past two years and dividing that total by 24 to determine a qualifying monthly average. If your overtime earnings decrease year over year, lenders might reduce or exclude this income, and without a full two-year record, most lenders will not include overtime when assessing your mortgage qualification.
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How is commission income calculated for a mortgage (if it’s 25% or more)?
Lenders calculate income from commissions by averaging your earnings over the most recent two years when commissions make up 25% or more of your total pay. If you have less than two years of commission history, lenders usually exclude this income unless you’ve remained in the same role, industry, and at the same employer and can demonstrate stable or increasing earnings. Some lenders might accept this with supporting documentation.
How is self-employed income calculated for a mortgage?
When you are self-employed, lenders review your personal and business tax returns to calculate qualifying income, typically over the most recent two years. They focus on net income after expenses, not gross revenue, and may average earnings if income fluctuates. In some cases, lenders consider a recent switch from W-2 employment to “consultant” status with the same company as continuous employment when the role, industry, and income remain consistent or increase, which can lessen the impact of the two-year self-employment requirement.
FAQs about job history for mortgage
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Yes. If you’ve just started a new job, you may need to provide additional documentation to show that you have a stable income, such as a job offer letter, employment contract, or recent pay stubs. The lender will also consider your credit history, debt-to-income ratio, and savings to determine whether you can afford the mortgage payments.
Yes, you can get a mortgage without a job. Retirees, divorced individuals, and people with significant savings and investments are commonly approved for mortgage loans without having salaried income from an employer. Provided that you can prove to a lender that you can repay your monthly obligations, you shouldn’t have too much trouble with the mortgage application process.
You can get a mortgage with a part-time job. Lenders often count earnings from part-time employment as qualifying income for a home loan. You’ll likely need to have held the part-time job for at least two years. Furthermore, your part-time income must also be steady and reliable.
Yes, you can get a mortgage when unemployed but have a cosigner. However, your co-signer must also act as a co-borrower, which means they will be on both the mortgage and the property title as owner. If your co-signer won’t live with you, the property will also be considered your co-signer’s second home or investment property. So you’ll pay a higher interest rate on the loan.
Yes, there’s no rule that prevents changing jobs before applying for a mortgage. But your lender likely won’t approve the loan if you have a new employer in the months prior to your application. In most cases, you’ll need at least a two-year work history with the same employer to get mortgage loan approval.
You might be able to find a lender online. Particularly, if you’re a self-employed borrower looking for a bank statement loan. However, lenders often prefer to work with borrowers one-on-one when evaluating and approving outside-the-box home loan applications. So if you want to become a homeowner without two years of employment, you’ll likely have to connect with lenders directly and ask about your options.
Mortgage lenders usually look into your job history for the past two years to assess your stability and ability to repay the loan. However, some lenders may require a longer job history, depending on the specific requirements and loan program.
Yes, you can use income from multiple jobs to qualify for a mortgage. Lenders typically consider the average income over the past two years from all jobs or sources when assessing your eligibility.
Lenders verify your employment history by requesting employment verification documents, such as pay stubs, W-2 forms, tax returns, or direct verification from your employer. They may also reach out to your employer directly to validate your employment details.
Yes, there are mortgage programs available for borrowers with limited job history, such as first-time homebuyer programs or loans specifically designed for individuals with non-traditional work situations. Consulting with a mortgage lender can help you explore these options.
In some cases, you may be able to exclude job history from a co-borrower or spouse on the mortgage application. However, their income and financial information may also be excluded, potentially impacting the loan eligibility and qualification amount. It is best to consult with a mortgage lender to understand the specific requirements and implications in such situations.
Qualify for a home loan with a less than two-year job history
You might not have a traditional, two-year employment history. But that shouldn’t stop you from getting a mortgage if you have a steady income. The key is to find a lender willing to work with you.
Many lenders are more flexible than they used to be. So begin your home buying process by comparing quotes from several lenders or reaching out to a mortgage broker. This will ensure you get the best mortgage rates for your situation.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.
By refinancing an existing loan, the total finance charges incurred may be higher over the life of the loan.
