The bank might ask for anything from an investor presentation to a thorough explanation of how you plan to run your business remotely.
Will gaps in employment history affect loan approval?
If a potential borrower has gaps in their employment history, it may affect their ability to get approved for a mortgage. Lenders want to see a stable employment history and consistent income, so if a borrower has gaps in employment, it may be viewed as a red flag.
However, there are certain circumstances in which lenders may be more lenient about employment gaps. For example, if the borrower took time off to care for a family member or for personal reasons, and can provide a valid explanation for the gap, the lender may be more understanding.
In addition, if the borrower has recently started a new job after a gap in employment, the lender will want to see proof of steady income and job stability. They may require the borrower to provide additional documentation, such as a letter from the employer or recent pay stubs, to show that the borrower is now back to work and earning a consistent income.
It’s worth noting that employment gaps can have a bigger impact on self-employed borrowers. Lenders typically require at least two years of self-employment income history to qualify for a mortgage, and any gaps in that income history can make it harder to get approved.
Overall, if you have gaps in your employment history, it’s important to be upfront with your lender about it and provide a valid explanation for the gap. Depending on your circumstances, there may be ways to mitigate the impact of an employment gap on your mortgage application.
However, it’s important to keep in mind that lenders ultimately want to see a stable employment history and consistent income, so anything that deviates from that may require additional documentation or explanation.