Maternity Mortgage Tips
Having a baby can be such an exciting time in someone’s life. But with that excitement can come uncertainty. For example, maybe you realized you need a bigger house to accommodate your growing family and are wondering how being on, or going on, maternity/parental leave will affect what you qualify for on a mortgage to purchase the perfect family home.
I want you to stay excited, so I am here to give you some insight into how maternity/parental leave affects qualifying for a mortgage, starting with how banks and lenders look at parental leave.
The good news is that banks and lenders will let us use your return-to-work income provided you have a letter confirming your return-to-work date and income at that time. But let’s break that down a little further as there are a few key things that determine what a lender uses for income:
Return-to-Work Date: How far away your return-to-work date is can impact what a lender uses for income. If you are at the start of your leave or are taking 18 months, what a lender uses for income can look different than if you are going back in, say, 6 months. This is where a mortgage broker comes in as we work with numerous banks and lenders, and it is our job to know who allows what on something like maternity leave and the income they will use. If you are 11 months away from returning to work, it is my job to know if there is a lender who will use your full income.
Payment Structure: How you are paid (salary, hourly, commission) or if you work overtime or receive bonuses can affect what a lender uses for income.
Application Details: With any mortgage application, we need to take a look at credit, income versus debt, employment/income, and how much down payment there is and where it is coming from.
Let me end by saying every situation is different, and the best way to know how parental/maternity leave could affect you buying a new home is to speak to a mortgage broker. We are here to look at your individual situation and advise on what your mortgage options are based on your details.
Nicki Pike
Senior Mortgage Broker
TMG The Mortgage Group
403.391.2053
nicki@mortgagegrp.com
If you would like to set up a time to discuss your situation, please reach out!
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This article was featured in LIFE CHANGES Magazine Summer 2024. Read it here.
Meet the Author - Nicki Pike
Nicki Pike is a Senior Mortgage Broker based in Red Deer and the founder of Mortgage With Nicki. Her goal is to personalize your mortgage experience. Nicki is passionate about helping people, especially women and first-time home buyers, navigate the process of getting a mortgage. She understands that a home is often the largest asset we have and a mortgage is often the largest debt we have. This is why she is dedicated to ensuring her clients understand their options and feel confident in the mortgage they choose. Nicki's goal is to empower people through home ownership and their mortgage, and being a broker allows her to do that.
When she’s not helping her clients feel empowered through their mortgage, you can find Nicki cheering her daughter on at gymnastics, out walking her rescue dog Roger, or riding her horse Wyn. She loves traveling and going on adventures and has traveled solo to places like Iceland and Portugal.
Note: The author, compiler and publisher do not assume and hereby disclaim any liability to any party due to these words coming from the author’s own opinion based on their experiences. This account is based on the author’s own personal experience. We assume no responsibility for errors or omissions in these articles.
