Lenders typically verify your employment twice: first during the application process and again shortly before closing. In rare cases, they may check a third time after closing — usually due to suspected fraud or a loan buyout.
Loan companies verify employment multiple times because they need confidence you have a stable enough income to buy a home. A mortgage is a significant investment for a bank, and job verification is one way the bank minimizes risk.
You may not qualify for the loan if you change jobs during the loan process or have an unsteady employment history. However, a change like a promotion can show that you have more financial stability.
That’s why it’s important to understand exactly when and how lenders check your employment and what to expect if something changes.
When do mortgage lenders verify employment?
1. During underwriting (initial verification)
The first verification happens when you apply for the mortgage during the underwriting process. The lender wants to know that you were honest about your income on your application and that you earn enough to meet the loan requirements.
Lenders spend the most time on the first employment verification. This verification is the most thorough. The lender may contact your employer, review pay stubs or W-2s, and compare it all against your application. It’s a critical part of underwriting, where the lender also reviews your credit, debts, and assets to assess risk and decide whether to approve your loan.
In underwriting, an underwriter researches your current income, debt level, credit history, and other factors to determine whether you can repay the loan. Based on their research, the underwriter recommends whether the lender should approve or deny your loan application.
2. Just before closing (verbal check)
Before closing — typically within 10 days of funding — your lender will conduct a second verification to confirm you’re still employed in the same position.
Suzane Downs, founder and mortgage broker at Palm Beach Mortgage Group, explains, “Most lenders will do what's called a verbal verification of employment before closing, usually within 10 days of the wire, to ensure the borrower still works there and that the position on the application is correct.”
This step is usually quick, but it’s crucial. If your lender can’t confirm your employment, they may delay or cancel the closing.
3. After closing (rare cases)
Most lenders don’t check employment after closing, but it can happen in specific scenarios:
- Suspected fraud or false application information
- Random quality control audits
- The loan is sold to another lender or servicer
In the case of a loan buyout, “doing the verification provides the new servicer useful background on the borrower's loan terms and makes them familiar with the original qualification details,” explains Crystal Olenbush, real estate expert at AustinRealEstate.com.
How do lenders verify employment?
Your potential lender will use one or more of the following methods to investigate your employment:
- Verification of employment (VOE) forms: The lender requests information from your current employer via VOE forms that include your job title, time at the company, salary history, current salary, bonuses, and other details.
- Verbal verification of employment (VVOE): The lender calls your employer to confirm the details in the VOE forms.
- IRS transcript reviews: The lender looks up your tax transcripts to confirm your employment information aligns with your W2s.
For self-employed applicants, tax documents are key. Fannie Mae guidelines require self-employed borrowers to have proof of at least two years of earnings to qualify for a mortgage.[1]
What happens if I lose my job or change jobs during the underwriting process?
Losing or changing your job will have a significant impact on your mortgage eligibility. Many lenders see a job change as a lack of stability that disqualifies you from a loan.
“The trickiest scenario that can come up is if a borrower loses their job or changes positions during underwriting,” says Olenbush. “This may delay closing or even cause the deal to fall apart, depending on the specific case.”
If you lose your job
- Tell your lender immediately. Withholding this info could be considered fraud.
- Share details about any severance package or savings you plan to use to make payments.
- Some lenders may pause the process until you find a new job.
If you change jobs
- The lender will evaluate whether the new role is similar in industry, title, and pay.
- A promotion or move to a higher-paying job may actually strengthen your application.
- Changing job types (e.g., from salaried to contract) could raise concerns.
What happens if I change jobs after closing on a house?
Job changes after closing don’t impact your mortgage eligibility, and you’re not required to notify your lender.
However, losing your job could affect your ability to keep up with payments.
Here’s what to do if your employment changes after closing
- ❌ Don’t ignore payment problems—this can lead to default or foreclosure
- ✅ Keep making mortgage payments on time
- ✅ Contact your loan servicer if you expect payment issues
How soon can I change jobs after closing on a house?
Technically, you can change jobs immediately after closing. But it’s wise to wait until your first few mortgage payments are comfortably made before making any risky financial moves.
Ned Priestly, former loans specialist and CEO of My-Quick Loan, says that “keeping a steady job for a few months post-closing can help maintain financial stability and avoid any potential complications with early repayment penalties or refinancing needs.”
FAQ
How many times do mortgage lenders verify employment?
Mortgage lenders typically verify employment twice. But special circumstances could prompt a third verification after closing.
How long does employment verification take for a mortgage?
Mortgage employment verification typically takes 2–5 business days after the initial request. Some instances, like delayed responses from employers, may cause the process to take longer.
Do lenders verify employment the day of closing?
Lenders often verify employment close to or on the day of closing to ensure potential borrowers are still employed. This is typically a verbal confirmation of employment.
Do lenders verify employment after closing?
Lenders only verify employment after closing under special circumstances like suspected fraud, application inconsistencies, or buyouts from another lender.
Can I quit my job after closing on a house?
Yes, you can quit your job after closing on a house. But it’s best to maintain steady employment after closing to ensure you can pay your mortgage.
What if my employer doesn't respond to a verification request?
Your lender may ask for alternate documentation, such as recent pay stubs or direct deposit records. It could delay closing if not resolved quickly.
What if I'm self-employed?
You’ll need to provide tax returns showing at least two years of consistent self-employment income, along with bank statements and possibly a CPA letter.
