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Can You Change Jobs Before Your Mortgage Closes in Canada?
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Landing a new job offer is always exciting, but if you’re in the middle of buying a home, you might wonder: can I change jobs before my mortgage closes in Canada? The short answer is yes—but it’s risky. A job change can affect your mortgage approval, delay the process, or even result in your approval being revoked.
In this guide, we’ll walk you through everything you need to know before switching jobs during the mortgage process, how lenders assess employment, and what to do to protect your homebuying plans.
Understanding the Impact of Changing Jobs Before Mortgage Closing
Lenders in Canada look for income stability and reliability when reviewing a mortgage application. A sudden job switch raises red flags about your ability to repay the loan consistently.
If your mortgage has already been approved, your lender has signed off based on your current employment status. Changing that can void your approval, especially if the new job comes with a probationary period, different income structure (like commission or hourly pay), or a gap in employment.
Some lenders are more flexible than others, but most require you to have a permanent full-time job with no probation in order to proceed with your mortgage.
Key Factors To Consider Before Switching Jobs
Changing jobs doesn’t automatically mean your mortgage will be declined, but the context matters:
- Is the new job in the same industry? Lenders prefer if you’re staying within your field.
- Is your salary increasing or staying the same? A drop in pay is a red flag.
- Does the new job have a probationary period? Most lenders won’t accept income from a job under probation.
- Is your employment type changing? Moving from salaried to contract or commission can affect approval.
- Are you mid-way through the closing process? The closer you are to closing, the riskier the switch becomes.
Why Employment Stability Matters to Lenders
Mortgage lenders want to know that you can make your monthly payments reliably. This is why they prefer to see:
- Two years of consistent employment
- No gaps between jobs
- Income that is stable and predictable
If you’re self-employed or rely on bonuses or commissions, you typically need two years of income history to qualify with most lenders.
What Happens If You Change Jobs After Mortgage Approval?
Let’s say you were approved for a mortgage, signed your documents, and then you changed jobs.
Your lender will likely perform a final employment check before closing. If they find out your employment situation changed, they could:
- Reassess your mortgage application
- Request a new employment letter or pay stubs
- Delay or revoke the approval
If you’re no longer employed, or if you’re in a probationary period, you might not meet the income verification criteria anymore. This could put your home purchase and deposit at risk.
How to Communicate a Job Change to Your Lender
Transparency is key. If you’re thinking of changing jobs, tell your mortgage broker or lender before making the switch. They can:
- Advise if the new job is acceptable
- Suggest waiting until after closing to switch
- Explore options like using your co-applicant’s income instead
- Recommend postponing your application if the change is too risky
In some cases, lenders may approve your application based on the new job offer – but only if there is no probation period and the new salary is guaranteed and higher than before.
Tips for Managing a Job Change During the Mortgage Process
If a job change is unavoidable:
- Ask for a job letter with no probation clause
- Try to stay in the same industry
- Avoid switching to variable income (like commission) if possible
- Wait to switch until after your mortgage closes, if you can
Some lenders might still work with you if you’ve changed jobs, but expect extra scrutiny and delays.
Legal and Financial Risks of Changing Jobs
If you fail to disclose a job change, and your lender discovers it before funding, you could:
- Lose your mortgage approval
- Lose your deposit if you can’t close on time
- Be sued by the seller if the deal falls apart
Your lawyer, who also represents the lender, is legally required to inform them of any material changes — including a job change. So it’s not a risk worth taking.
FAQs
Does changing jobs always delay closing?
Not always, but it often requires a reassessment that can cause delays.
Can I change jobs after I get my mortgage approved?
Technically yes, but it can put your deal at risk. Wait until after closing if possible.
Will a job change affect mortgage renewal?
Not usually, unless you’re switching lenders or refinancing. Renewals don’t require new income checks.
What if I lose my job before closing?
Inform your lender immediately. You may need a co-signer or a new lender willing to work with your updated income situation.
Final Thoughts
