March 7, 2024

Can I Get a mortgage if I Just Started A New Job?

Can I Get a mortgage if I Just Started A New Job?

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Manzeel Patel

Manzeel Patel

Mortgage Broker, LIC M11002628, Level #2

Manzeel is an award-winning Mortgage Broker and the Owner of the Toronto-based mortgage, Everything Mortgages. With 16 years of experience in the Canadian mortgage industry and a formal background in mortgage underwriting, Manzeel’s lending expertise gives him unique insight into whether a deal is feasible which empowers his clients to make more informed lending decisions faster. He has been recognized as one of Canada’s Top 10 Mortgage Brokers by the national Canadian Mortgage Professionals (CMP) Association. Him and his team of 18 mortgage agents are proud to offer a mortgage experience that's built on honesty, trust, and integrity. He prides himself on the brokerage’s dedication to deliver an excellent client experience throughout the entire home loan process from pre-approval to post-funding. Since moving to Toronto in 1998, Manzeel has successfully launched and scaled several businesses from the ground up, ranging from a mortgage brokerage and a vast real estate investment portfolio to a private financing eCommerce platform. He continues to be a leader in the real estate industry as he uses his analytical expertise to seek new real estate investment opportunities. As a tech junkie and avid sports enthusiast, when Manzeel’s not working with clients, you can find him  reading technology blogs, playing squash or watching tennis with his two boys.

307-18 Wynford Drive,
North York ON, M3C 3S2

manzeel@everythingmortgages.ca

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Securing a mortgage for your dream home marks an exciting chapter in anyone’s life. However, individuals who have recently embarked on a new career path might face apprehension regarding their mortgage approval odds. The journey to homeownership is nuanced, but with the right knowledge and preparation, achieving this milestone is within reach, even for those new to their jobs.

Understanding the Importance of Employment History

Lenders prioritize stability and consistency in your employment history to ensure a reliable income stream for mortgage payments. Transitioning to a new job doesn’t necessarily hinder your chances, especially if you’ve demonstrated a strong employment track record in the past.

Key Points:

  • Preferred Employment Duration: Lenders typically look for at least two years of stable employment history. Gaps exceeding six months may require explanation.
  • Case-by-Case Consideration: Unique borrower situations are considered, and solutions tailored to fit individual needs are available.

Having a strong employment history with previous employers can work in your favor. Lenders understand that career growth often involves job changes, and they consider factors such as industry demand, salary prospects, and the applicant’s overall financial profile.

The Role of Income in Mortgage Approval

Income stability is a cornerstone of the mortgage approval process. Starting a new job might raise questions about income consistency, but certain factors can alleviate lender concerns.

Considerations:

  • Field and Salary Prospects: High-demand fields with promising salary trajectories can positively influence lender confidence. If your new job is in a growing industry or offers a higher income potential, it can mitigate the impact of your limited employment duration.
  • Documentation: Presenting offer letters or contracts indicating future income increases can support your application. It’s essential to include any details that demonstrate the stability and growth potential of your new position.

It’s important to note that lenders assess your overall financial health when evaluating your income. They consider not only your current income but also your debt-to-income ratio. If your new job offers a higher salary, it can positively affect this ratio and improve your chances of mortgage approval.

Credit History: A Pillar of Financial Trustworthiness

A robust credit history underscores your reliability in managing debt and making timely payments. This aspect of your financial profile is critical, especially when recent job changes are part of your application.

Strategies for Stronger Approval Odds:

  • Credit Score Improvement: Aim for a credit score above 670 (considered “Good” by most standards) to bolster approval chances. If your credit score is lower, take steps to improve it by paying bills on time, reducing credit card balances, and addressing any errors on your credit report.
  • Debt Management: Reducing outstanding debts can enhance your debt-to-income ratio, a key metric for lenders. By minimizing your monthly debt obligations, you can demonstrate your ability to handle mortgage payments despite a new job.

If you have a strong credit history and a history of responsible debt management, it can offset the potential concerns arising from your limited employment history with your current employer. However, if you have a poor credit score or a lot of outstanding debt, it may be more challenging to get approved for a mortgage.

Enhancing Your Mortgage Approval Prospects

If concerns about mortgage approval loom large due to a recent job change, several strategies can improve your outlook.

Valuable Tips:

  1. Engage a Mortgage Broker: Professionals like us at Everything Mortgages specialize in navigating complex borrower profiles and have access to a wide range of lenders. We can provide guidance, help you understand your options, and connect you with suitable lenders who are more willing to work with borrowers with unique circumstances.
  2. Consider a Co-borrower: Applying with a spouse, partner, or family member who has a stable employment history can strengthen your application. A co-borrower can provide additional income and employment stability, making lenders more confident in approving your mortgage.
  3. Organize Financial Documentation: Ready access to pay stubs, tax returns, and bank statements can streamline the approval process. Lenders will want to review your financial documents to assess your income, debt, and overall financial stability. By having these documents in order, you can provide lenders with the confidence they need to approve your mortgage.

Case Studies and Success Stories

Incorporating real-life scenarios can provide tangible hope and practical insights for prospective homeowners.

Example 1:

John, a software engineer, switched jobs two months before applying for a mortgage. Despite the short tenure at his new position, his field’s high demand and substantial salary increase played in his favor. With a credit score of 720 and minimal debt, John successfully secured a mortgage with a competitive interest rate. His strong employment history with previous employers, coupled with his excellent financial standing, reassured lenders of his ability to meet mortgage obligations.

Example 2:

Sarah, a teacher with a decade of experience, faced a six-month employment gap due to relocation. Her new job’s stability, combined with a strong credit history and a detailed letter of explanation, helped her obtain mortgage approval. Sarah’s employment history, along with her consistent track record of responsible financial management, convinced lenders of her ability to handle mortgage payments despite the recent job change.

These case studies highlight the importance of presenting a comprehensive picture of your financial situation. By emphasizing your strengths, such as your industry demand, income potential, credit history, and debt management, you can demonstrate your ability to handle a mortgage despite a new job.

Conclusion: Turning Homeownership Dreams into Reality

Starting a new job does not preclude you from achieving homeownership. With strategic preparation, thorough documentation, and expert guidance, navigating the mortgage approval process can be a smooth journey. At Everything Mortgages, we’re committed to making your dream home a reality, regardless of your employment timeline.

Remember, every situation is unique, and professional advice is invaluable in making informed mortgage decisions. Start your journey with us today and unlock the door to your future home.


At Everything Mortgages, we strive to help first-time homebuyers, small business owners, and hardworking professionals navigate their mortgage journeys. Whether it’s securing a loan or seeking better solutions, our team is here to guide you toward becoming mortgage-free sooner and building wealth faster. Reach out to us today to explore these strategies and more.

Note: This article is intended for informational purposes only and does not constitute financial advice. Please consult a financial advisor or mortgage professional before making decisions about your mortgage.


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