Mortgage Loan Work History Requirements
Understanding the work history requirements for different mortgage loan types can help streamline your application process.
Conventional Mortgage Loan Work History Requirements
Job History Required:
- 2 years of related work history is generally expected.
- If there are employment gaps, most lenders like to see at least 6 months at the current job.
Compensating Factors:
- If someone has less than 2 years total work history, it may still be acceptable if they can document relevant education or provide a letter of explanation about a recent job change.
- Essentially, the borrower should show how their background (e.g., schooling or on-the-job training) supports their current position.
FHA Mortgage Loan Work History Requirements
Job History Required:
- 2 years of related work history is preferred.
- 6 months at the current job if there have been employment gaps in the recent past.
Compensating Factors:
- The FHA lender wants to feel confident the borrower is qualified for their current position and likely to continue in that job (or move into a better position).
- It’s all about showing stability and a solid likelihood of ongoing employment.
VA Mortgage Loan Work History Requirements
Job History Required:
- 2 years or a combination of relevant schooling/training or military service to cover that two-year window.
- If the borrower is active military, they should be more than 12 months away from their release date.
Compensating Factors:
- The lender needs to verify the borrower has the necessary skills for the current job.
- This could be demonstrated through a relevant degree, specialized training, or prior work experience.
USDA Mortgage Loan Work History Requirements
Job History Required:
- There’s no minimum time the borrower must be in the current position.
- However, they need to prove 2 years of work or related history overall.
Compensating Factors:
- It’s fine if the borrower has moved around between jobs, but they must explain any big gaps or changes.
- If the borrower spent time getting a degree or had a period of military service, they can document those periods (e.g., transcripts, discharge papers) to fill that two-year window.
Each loan program has its own guidelines, but they all circle back to the same main point: lenders want to see a stable or justifiable work history. Even if someone doesn’t have a full two years in one specific role, there are plenty of ways to show their background and explain any gaps—through education, training, military service, or simply providing a solid letter of explanation.
Remember, these requirements can also vary slightly depending on individual lender overlays (extra guidelines), so it never hurts to check with specific lenders. But in general, if someone can document a consistent timeline (or provide clear reasons if there are gaps), they’re on a good path for mortgage approval.
