Yes, it is possible to get a mortgage while unemployed if you have alternative income sources, substantial liquid assets, or a co-signer. Lenders focus on your ability to repay, often requiring a 15–25% down payment, a high credit score ( 680 – 720 + 6 8 0 – 7 2 0 + ), and proof of consistent, non-employment income like investments or retirement funds.
But can you get a mortgage without a permanent job? The answer depends on the specifics of your financial situation and the lender you choose to work with. However, broadly speaking, yes, borrowers who meet their lender's financial criteria can potentially get a mortgage without having a full-time job.
It's possible to use unemployment income to qualify for a mortgage, though there are some contingencies. Ultimately, as with other income types, mortgage lenders are looking for consistency. Some job types have a history of hire/layoff cycles.
Other forms of income for a mortgage loan
Ordinarily, lenders can't count unemployment benefits as income. But they may let you qualify when you bring proof of disability benefits to the table.
If you have a down payment of at least 35% of the purchase price, you may still qualify for a mortgage with little-to-no Canadian employment or credit history.
If you are unemployed and receiving benefits, being accepted for a mortgage may be difficult as many lenders aren't willing to lend to unemployed applicants, even if your benefits allowance is enough for a mortgage. However, there are specific lenders who will consider your application.
If you lose your job, call your lender right away
You should contact your mortgage servicer as soon as you anticipate financial hardship, says Hala Garmo, regional mortgage manager for U.S. Bank. They can help you come up with a plan — after all, they have a financial incentive to keep you paying your mortgage.
Unemployment benefits are only considered “temporary income” and you cannot use that to qualify for a mortgage loan. You will have to reapply for a loan when you establish a work history at another job.
Unemployment rates affect the perception of the economic outlook. Because mortgage rates are influenced by expectations of future economic conditions, high unemployment rates may indicate weakness and cause lower mortgage rates as investors avoid buying property.
The 3-7-3 Rule in mortgages isn't a loan type but a federal timeline from the TILA-RESPA Integrated Disclosure (TRID) rule, ensuring borrower protection by mandating disclosures within 3 business days of application, a 7-business-day wait between the initial Loan Estimate and closing, and another 3-day wait if significant changes (like APR) occur, giving borrowers time to review costs before committing to a loan.
Even without a job, you can generally get an emergency loan if you can provide a reliable source of income. Lenders that offer loans without proof of income may be predatory and charge triple-digit APRs.
In fact, it's possible to get a mortgage without employment as long as lenders are able to determine that you can repay the loan. As long as you're able to provide a potential home mortgage lender with proof that you can to meet your monthly mortgage obligations regularly and on time.
For individuals who are unemployed but receive benefits — like unemployment insurance, disability payments, or worker's compensation — can request forms from whatever entity pays them. These forms, whether they're from the government or an insurance company, can act as proof of income.
Your employment status isn't a matter of public record
The fact that you're unemployed will never show up on your credit report. Some lenders might ask about your employment when you apply, but they won't see it in your report or credit score.