Many homebuyers worry that changing jobs when they need a new mortgage will automatically disqualify them from getting approved.
This concern leads some people to pass up job opportunities, while others make job moves without understanding how it might impact their house purchase.
The rules aren’t always straightforward as different lenders have different policies. In this article, we’ll explain exactly how job changes affect mortgage applications, which situations may cause problems, and which ones might actually help your cause.
How Mortgage Lenders View Your Employment
Contrary to popular belief, mortgage lenders aren’t trying to keep you in the same job forever. What they’re really interested in is whether you can afford the mortgage payments both now and in the future.
When assessing your application, lenders look at your employment history as a way to measure stability and risk. They want to see that your income is reliable and likely to continue.
This doesn’t necessarily mean sticking with the same employer – it’s more about consistent work in a particular field or profession.
Affordability Rules
UK lenders have become more thorough in their employment checks since the Financial Conduct Authority (FCA) introduced stricter affordability rules following the 2014 Mortgage Market Review. These regulations require lenders to verify your income and assess whether you could still afford your mortgage if interest rates were to rise.
Remember that your employment status is just one factor in a broader affordability assessment.
Lenders will also consider your credit history, existing debts, financial commitments and spending habits. A strong performance in these areas can sometimes offset concerns about recent job changes.
Different Types of Job Changes and Their Impact
Not all job changes will affect your mortgage application in the same way. Let’s break down the main types of changes and how lenders tend to view them.
Promotions and Pay Rises
Getting promoted or receiving a pay rise while staying with your current employer is generally good news, for you and your mortgage prospects!
Lenders view this positively as it shows career progression without the uncertainty of changing employers.
Say you’re a teacher who’s moved from the main pay scale to the upper pay scale. This represents natural career progression and increased financial stability. To make the most of your pay rise, you’ll need to provide your most recent payslips showing the increased salary and possibly a letter from your employer confirming the permanent nature of the change.
If your pay rise happens shortly before or during your mortgage application only some lenders will accept the higher salary straight away.
This is why speaking to a mortgage broker can be helpful – they know which lenders will be most favourable to your situation.
Changing Employers in the Same Field
Moving to a new employer while staying in the same line of work is a common scenario that most lenders can accommodate, though it may require additional documentation.
For example, an accountant moving from one accounting firm to another for better pay or career prospects presents less risk to lenders than someone changing careers entirely. The skills are transferable, and the move suggests career development rather than instability.
Many lenders will want to see that you’ve completed any probationary period in your new role before approving your mortgage. However, some are more flexible and will consider your application if you can provide a copy of your employment contract, evidence of your previous experience in the sector, and confirmation of your new salary.
Complete Career Changes
A complete change of career presents more challenges for mortgage applications, but it’s not an insurmountable barrier.
Consider someone leaving a teaching position to become a software developer. This represents a significant shift that might raise questions for lenders about your long-term job security and income stability.
In this scenario, lenders will look more closely at why you’ve made the change and whether your new role offers genuine prospects.
To strengthen your application after a career change, you should:
- Wait until you’ve been in your new role for at least 6 months, ideally longer
- Provide evidence of qualifications or training for your new career
- Demonstrate that your new job offers comparable or better financial security
- Consider putting down a larger deposit to reduce the lender’s risk
Moving to Contract or Self-Employment
The most significant change from a mortgage lender’s perspective is moving from permanent employment to contract work or self-employment.
This switch changes how your income is assessed and what documentation you’ll need to provide.
Take a marketing manager becoming a freelance marketing consultant. Even if the day-to-day work is similar, the income structure and perceived stability are completely different from a lender’s standpoint.
Most high street lenders want to see at least 2 years of accounts for self-employed applicants. If you’ve recently made this switch, you might need to look at specialist lenders who are more accommodating to newly self-employed people.
For contractors, lenders often calculate your annual income based on your day rate multiplied by the number of working days in a year (often around 230-260 days). You’ll need to provide copies of your contracts and evidence that you have a history of contract renewal or securing new contracts.
Some specialist lenders will consider applications from newly self-employed individuals with just one year of accounts, particularly if you can show a strong pipeline of work and previous experience in the same field.
Read more: Can I get a mortgage if I’m self-employed?
Timing Your Job Change and Mortgage Application
When you change jobs can be just as important as what job you change to.
Careful timing can make the difference between approval and rejection.
If you haven’t started your mortgage application yet, it’s generally better to apply after you’ve settled into your new role, especially if you’re changing employers.
Most lenders prefer to see at least three months of payslips from your new job, and some may want to see that you’ve passed your probation period.
What if a job opportunity comes up while you’re in the middle of buying a house?
This is when timing gets trickier. If you’ve already received a mortgage offer, changing jobs before completion could cause problems. The lender has approved your application based on your current employment, and any changes mean they need to reassess.
If you’re planning to change jobs, consider this timeline:
- Apply for your mortgage while still in your current job
- Receive your mortgage offer
- Complete your house purchase
- Accept your new job
Of course, life doesn’t always work out so neatly.
If you must change jobs during your application, tell your mortgage broker or lender straight away. Hiding it will only cause problems later.
In many cases, they can work with the new information, especially if your new job offers the same or better salary in the same field.
For those moving from employment to self-employment, the timing is even more crucial.
If possible, it’s better to secure your mortgage while you’re still employed, then make the switch afterwards. Otherwise, you might need to wait 1-2 years to build up the accounts history that most lenders require.
Common Scenarios and Solutions
Let’s look at some common situations you might face and how to handle them.
First time buyer
For first-time buyers who’ve recently changed jobs, the key challenge is often proving stability.
If you’ve moved to a better-paid position in the same field, focus on demonstrating career progression. A slightly larger deposit can also help offset the risk of your recent job change. Some lenders offer specific products for professionals (like doctors, lawyers, accountants) who may move jobs but stay within their profession.
Read more: First Time Buyer Guide
Home mover
Home movers with new employment face slightly different challenges.
While you have a track record of managing a mortgage, lenders will want to ensure your new job allows you to afford a potentially larger loan. If you’re upsizing and have changed jobs for better pay, make sure your application emphasises how your new role improves your affordability rather than creating uncertainty.
Remortgage
If you’re remortgaging after a career change, you have the advantage of an existing payment history on your current mortgage.
Lenders can see that you’ve managed your mortgage payments successfully, which may make them more willing to overlook a recent career change. However, if you’re looking to borrow more, you’ll face similar scrutiny to a new application.
Read more: Remortgage Guide
Reduced pay
What about situations involving pay cuts or reduced hours?
These can be challenging but not impossible.
If you’ve taken a pay cut for better long-term prospects, job satisfaction, or work-life balance, be prepared to explain this. You might need to adjust your borrowing expectations or put down a larger deposit. Some lenders will consider your overall financial picture, including any savings or investments, rather than just your salary.
Affordability
Even when the lender is accepting of your job change, you still need to pass their affordability assessments. This is to check whether you can actually afford the monthly repayments, when your other commitments have been included.
How to Improve Your Chances
If you’ve recently changed jobs, there are several steps you can take to strengthen your mortgage application.
Consider putting down a larger deposit if possible.
While most residential mortgages start at 5% or 10% deposits, offering 15% or more can significantly improve your chances after a job change. For example, if you’re buying a £500,000 property, increasing your deposit from 10% (£50,000) to 15% (£75,000) could make lenders more willing to overlook your recent change in employment.
Another option is using a guarantor.
A family member with significant equity in their own property or strong income can act as a guarantor for your mortgage, reducing the risk for the lender. This approach can be particularly useful for first-time buyers who have recently changed jobs.
Building a stronger overall financial profile is also helpful.
This includes:
- Maintaining an excellent credit score
- Reducing or clearing other debts before applying
- Ensuring you’re on the electoral roll
- Avoiding major spending in the months before your application
- Having a clear budget that shows you can afford the mortgage payments
Be strategic about which lenders you approach.
Some high street banks have strict policies about employment history, while others take a more flexible view. Building societies and specialist lenders often take a more individual approach to applications, considering your specific circumstances rather than applying rigid rules.
Read more:
How a Mortgage Broker Can Help
For anyone dealing with recent job changes, a mortgage broker can be particularly valuable.
Here’s why:
Brokers have access to a much wider range of lenders than you’ll find on the high street.
This includes specialist lenders who don’t deal directly with the public but offer products specifically designed for people with non-standard situations – like recent job changes or newly self-employed.
More importantly, brokers know the specific policies of different lenders.
Rather than submitting applications and hoping for the best, they can target lenders who are most likely to accept your circumstances. This saves you time and protects your credit score from multiple rejected applications.
A broker can also help present your case in the best possible light.
They know what information lenders need and how to explain situations like job changes positively. For instance, a broker might emphasise how your recent move represents career progression rather than instability.
Most brokers offer a pre-application assessment to identify potential issues before you formally apply. This allows you to address any concerns or gather additional documentation that might strengthen your application.
Take the case of a project manager who moved from permanent employment to contracting just before applying for a mortgage. Most high street banks wouldn’t consider his application with less than a year of contracting history.
However, a broker identified a specialist lender who calculated his income based on his day rate and previous experience in the field, securing approval for a £600,000 mortgage that wouldn’t have been possible through direct applications.
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Changing jobs doesn’t have to derail your mortgage plans. With proper planning, you can balance career advancement with property purchase.
The most important thing to remember is that lenders care about stability and affordability, not keeping you in the same job forever. If your new position offers the same or better income security, many lenders will be happy to consider your application.
Timing matters. If possible, try to secure your mortgage before changing jobs, or wait until you’re established in your new role before applying. If that’s not possible, be prepared with extra documentation and perhaps a larger deposit.
Remember that different lenders have different policies.
If one rejects you, that doesn’t mean they all will. This is where a good mortgage broker can make all the difference, helping you find lenders who understand your situation.
Your first step should be to assess your specific circumstances and gather the relevant documentation.
Then, consider speaking to a mortgage broker who can guide you through the options available based on your particular situation. With the right approach, your new job could even enhance your mortgage prospects rather than hindering them.
Frequently Asked Questions
Most lenders prefer you to have been in your new job for at least 3-6 months before applying.
However, this varies widely between lenders. If you’ve moved to a similar role in the same industry, some lenders will consider your application immediately, especially if you’ve passed your probation period. For complete career changes, you might need to wait 6-12 months to improve your chances.
Read more: How Long Do You Need to Be in a Job to Get a Mortgage?
Not necessarily.
If your new job comes with a higher salary, you might actually be able to borrow more.
Most lenders use income multiples (typically 4.5-5 times your annual income) to calculate how much you can borrow. However, if you’ve just started a new job, some lenders might be more cautious with these calculations or want to see a longer track record in your new role before offering the maximum amount.
Yes, significantly.
Most lenders view this as a major change in your employment status and income structure. For contract workers, many lenders will want to see at least 12 months of contracting history, though some specialist lenders may consider applications with less.
They’ll typically calculate your income based on your day rate multiplied by the number of working days in a year (usually between 230-260 days).
Read more: Contractor mortgages
Yes, several specialist lenders and some building societies take a more flexible approach to employment changes.
These lenders assess applications on a case-by-case basis rather than applying rigid rules.
They’re particularly helpful for people who’ve recently changed careers, become self-employed, or started contract work. A mortgage broker with access to the whole market can help you identify these specialist lenders.
Lenders reserve the right to conduct a final check of your employment status shortly before completion.
This might involve calling your employer to confirm you’re still employed there or asking for your latest payslip. This is why it’s essential to inform your lender if your employment situation changes between mortgage offer and completion.
If you’ve changed jobs without informing them, they could withdraw their offer.
Related: Do mortgage lenders do a final credit check before completion?
Quite a few lenders have specific policies for professional occupations.
They can be more understanding of job changes within these professions, recognising that skills are highly transferable and employment prospects are generally secure.
Some lenders offer professional mortgages specifically designed for doctors, lawyers, accountants, teachers and other professionals, with more flexible criteria regarding job changes and sometimes higher income multiples.
Most lenders prefer to see at least 3-6 months of employment history before approving a mortgage. And for you to have successfully completed any probationary period.
However, some lenders have specific products for recent graduates or newly qualified professionals entering their first proper job, especially in fields like medicine, law, or accounting.
You might need a larger deposit, and lenders will pay close attention to your probation period. Having a guarantor can also help in this situation.
Absolutely.
When you’ve recently changed jobs, your credit score becomes even more important as lenders will scrutinise your application more carefully. Check your score with all three main UK credit reference agencies (Experian, Equifax, and TransUnion) at least 3-6 months before applying.
This gives you time to correct any errors, pay down existing debts, and avoid making new credit applications. Remember that each credit reference agency may hold slightly different information, so checking all three gives you the most complete picture of your credit profile.
Read more:
Not automatically, but it does create a challenging situation.
Lenders assess risk based on multiple factors, and having both credit issues and recent employment changes raises significant red flags. However, specialist adverse credit lenders might still consider your application, particularly if your job change was for a higher salary and you have a reasonable explanation for your credit problems.
You’ll likely need a larger deposit (possibly 25-30%) and should expect higher interest rates. Working with a broker who specialises in complex cases is essential in this situation.
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