Getting a Mortgage While on Maternity Leave: What to Know

Can you get a mortgage while on maternity leave?

Yes, you can still qualify for a mortgage while on maternity leave. Lenders aren’t legally allowed to reject your application just because you’re pregnant or temporarily not working. If they do, that directly violates the Fair Housing Act and the Equal Credit Opportunity Act.

What lenders evaluate instead is whether you'd be able to afford the mortgage payments during the time you aren't working. That means they’ll probably look at your current income, any leave-related income, your assets and whether you’ll return to work at your regular pay level.

Paid vs. unpaid leave paperwork

Standard documentation is usually enough for underwriting if you’re on paid leave. If your leave is unpaid, you'll usually need a letter from your employer confirming your return-to-work date and regular salary.

If you’re applying for a mortgage with a partner or co-borrower, that person’s income and credit profile will also be a part of the equation. Joint applications can strengthen your application and make it easier to qualify, assuming your partner or co-borrower’s income remains steady during your unpaid leave.

Documents needed for a mortgage application during maternity leave

When applying for a mortgage while on maternity leave, you’ll need to show lenders that you’re still employed and financially capable of keeping up with the mortgage payments before and after maternity leave.

For many borrowers, that means providing a return to work letter from your employer, plus proof of any leave income you’re receiving. Some lenders may also ask for a letter of explanation that briefly outlines how long you’ll be out and your expected return date.

Here’s a quick rundown of the documents you may need to provide:

• An employer letter verifying your current job status, salary and expected return-to-work date
• A personal letter of explanation that outlines your leave and confirms your return date
• Contact details for your employer for income and employment verification
• Pay stubs and bank statements from at least 30 days before your leave began
• Federal tax returns and W-2s from the last two years
• Benefits statement or short-term disability pay stub
• Proof of any additional income, like child support or alimony
• Statements for retirement and investment accounts
• Most recent loan statements
• Gift letter documentation, if any of your down payment came from someone else
• Details on any other properties you own, if applicable

How maternity leave affects borrowing power

Being on maternity leave doesn’t automatically hurt your chances of getting a mortgage, but it can affect how much you qualify for — especially if your income is temporarily lower. Lenders still have to evaluate your ability to repay the loan.

If they have enough documentation to support your return-to-work timeline, a lender might be able to use your post-leave income instead of your temporary leave income. In other cases, they may qualify you based on the income you’re receiving during leave, which can mean a smaller loan offer.

Often, lenders ask for a letter confirming your employment status and return date to make sure you’ll have a steady income in the long term. Paid leave or a co-borrower with steady income can help you qualify for more, especially if you also have a solid credit score, low debt and some savings.

Tips for getting mortgage approval

Getting approved for a mortgage while you’re on maternity leave may require a little more planning, but it’s still very possible. Here are some ways to improve your mortgage approval chances:

• Have a solid financial foundation: Regardless of whether you’re on maternity leave, lenders want to see a strong financial cushion. Pay down any debts you have and try to save up for a bigger down payment or emergency fund. This will show lenders that you’re financially stable enough to handle a mortgage, even with a temporary dip in income.
• Choose the right lender: Not all lenders have experience handling maternity leave. So take the time to shop around and find lenders that are familiar with your circumstances.
• Add a co-borrower: If you aren’t confident about your financial situation, consider applying with a partner or co-borrower who has steady income to make your application stronger.
• Submit all the required documents: Even if you’re qualified, missing required documents could delay your application process and hurt your chances. So make sure you have everything lenders might ask for, like a return to work letter, proof of any income during leave and a letter of personal explanation, if needed.

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Reporting maternity leave housing discrimination

If a lender denies your mortgage application just because you’re on maternity leave, that may be housing discrimination. Under the Fair Housing Act, it’s illegal for lenders to treat you differently based on sex, familial status or pregnancy.

Some examples of discriminatory practices include refusing to count paid maternity leave as income, requiring you to return to work before approving your loan or denying you outright solely based on the fact that you’re expecting a child.

Illegal lending practices include:

• Refusing to count income from paid leave
• Not allowing you to apply until you return to work
• Denying your loan solely based on pregnancy or intent to take family leave

Maternity leave shouldn’t keep you from getting a home loan you otherwise qualify for. If you think you’ve been discriminated against, you can file an official complaint with the U.S. Department of Housing and Urban Development. It’s free and can be done online, by phone or through your local fair housing agency.

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