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Will an Employment Gap Hurt My Chances for Mortgage Approval?

Published June 22, 2020

The coronavirus pandemic has had a massive impact on the American job market, leaving millions of workers unemployed. If you've found yourself out of work for an extended period of time, you might wonder if having an employment gap will hurt your chances of getting a mortgage approved in the future. There are a handful of factors to consider in this situation.

When Was Your Gap Period?

Depending on when your employment gap occurred, you might not have anything to worry about. The vast majority of lenders will only ask for your work history over the past two years, so if your employment gap occurred before then, you shouldn't have anything to worry about.

If you did have an employment gap in your work history over the past two years, most lenders would look at how long your unemployment was. If it was only a short period of a month or two, then it likely will not affect your mortgage process. Lenders will only be concerned with extended gaps of six months or more.

When Is a Gap Acceptable?

There are plenty of situations in which an employment gap is perfectly acceptable to a lender. Due to the recent pandemic, millions of Americans have found themselves unemployed since March 2020. If your employment gap occurred during this time, then most lenders will be sympathetic and understanding that these issues were beyond your control. Other justifiable explanations for an employment gap include taking maternity leave and going back to school.

Your employment history will only concern your lender if it is erratic. Taking months off from work without a justifiable explanation or bouncing between 4 different jobs in a single year can worry your lender.

Can You Explain Your Gaps?

Ultimately, your lender wants to know that you are reliable and can be depended on to repay your loan. That is why it's important to provide a reasonable explanation for every employment gap. If possible, you should try and support every explanation with official documentation for supporting evidence. For example, if you were laid off due to the coronavirus, try and provide documentation (such as an email or official company announcement) that supports that. Similarly, if you stopped working to go to school, you can share your transcripts or degree. If you can show your lender that you were thoughtful and responsible for your employment gap, you can make your gap less of an issue for your mortgage approval.

Why Big Life Home Loan Group?

It's no exaggeration to say that these are uncertain times. That's why it is critical to partner with experienced lending specialists to help you through the mortgage process. Our team of experts at Big Life Home Loan Group is dedicated to helping you through every step of the mortgaging process.

Contact Big Life Home Loan Group Today

To learn more about the many reliable home lending services we offer, contact us today to reach one of Big Life Home Loan Group's experienced consultants.


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