Lenders prefer to see that you have at least two years of work history, as two years is considered enough time to demonstrate consistency, stability, and financial reliability.
Most lenders require a 2-year work history unless it's been documented that you were going to school (or a technical training program) directly prior to current employment.
Gap Period
If you have had gaps in the past two years, lenders are most concerned by unemployment periods of six months or more. If you were out of a work for just a month or two, there may not be an issue with your mortgage approval.
A big gap of several months to a year on your resume is a massive red flag to employers, even if you have a valid reason for taking that time off. More often than not, you'll have a good reason to avoid employment for a while, whether it's to look after your family or travel Europe.
Key Takeaways. ✅ FHA loans require a two-year work history to demonstrate stable employment, but job changes and gaps in employment are generally acceptable as long as certain criteria are met.
Ideally, lenders look for you to have a two-year employment history in your current position when approving you for a mortgage. However, it's possible to get approved with a shorter employment history, as long as you can provide the appropriate documentation.
You can get a mortgage with no job but a large deposit if it makes financial sense for you. If you have a good credit history, lenders may be willing to look past your unemployment if you have cash reserves that will help you pay for the loan.
With a $60,000 annual salary, you could potentially afford a house priced between $180,000 and $250,000, depending on your financial situation, credit score, and current market conditions. However, this range can vary significantly based on several factors we'll discuss.
Most traditional lenders require two years of consistent work history whether you are self-employed, or a w2 wage earner. This work history requirement is found in all Fannie Mae and Freddie Mac loans and is driven by the federal government.
Conventional loans
If you start a new job, lenders usually accept a job offer letter with a new employer (same industry or line of work) that can be used to verify your new employment, as well as a college transcript showing your education leading up to your current job.
It is possible to get a mortgage with less than 2 years of work history in certain situations. Lenders typically prefer a 2-year employment history but may make exceptions based on various factors. Recent graduates, career changers, and those with employment gaps may still qualify under specific circumstances.
The FHA recognizes various forms of income: Unemployment benefits: If you're receiving unemployment, this can be considered income. However, the lender must determine if this income is likely to continue. Self-employment income: If you're self-employed or a freelancer, you may still qualify.
If you have money saved up or investment assets and can make a substantial down payment to ease lender concerns over your lack of income, you may be able to get approved as long as your credit history and credit score are good enough.
Yes. There is not a specific minimum income to qualify for a mortgage and there are various loan types and programs designed to help eligible buyers cover a down payment or even closing costs.
I make $25K a year; can I buy a house? Yes, if you make $25K a year, you can likely afford around $580 per month for a monthly mortgage payment. With a 6% fixed rate and a 3% down payment, this could buy you a house worth about $100,000. However, consult a mortgage lender for exact numbers tailored to your situation.
On a $50,000 salary, you could potentially afford a house worth between $160,000 to $190,000, depending on your specific financial situation and local market conditions. While this may limit your options in some high-cost areas, there are still many markets where homeownership is achievable at this income level.
This is why employment requirements for many mortgages usually include a work history of at least two years, as well as income verification. This information helps lenders gauge whether you're a good candidate for a loan, as well as the terms of the loan — should you receive an offer.
The Quick Answer. A $100,000 salary positions you within striking distance of homes priced between $225,000 and $300,000, but remember, it's not a one-size-fits-all answer. Your unique financial picture, creditworthiness, and the ever-changing housing market all play a role in pinpointing your precise affordability.
Conventional loans typically require a minimum credit score of 620, though some may require a score of 660 or higher. These loans aren't insured by a government agency and conform to certain standards set by the government-sponsored entities Fannie Mae and Freddie Mac.
You may be denied for an FHA loan if you have declared bankruptcy but you have not had the bankruptcy discharged. You may be denied if you are delinquent on federal taxes or otherwise owe money to the federal government but without an approved payment plan.
FHA-specifics
If you can show proof that you have now been employed for at least a six-month period before requesting a FHA loan, AND that before any employment gap you worked for two-years straight or longer, you have the potential to get approved.
The Bottom Line
If you're a seasonal worker, the key requirement to remember when applying for a mortgage is that you must be able to demonstrate a 2-year history of consistent seasonal employment and reliable income.