Mortgage After Redundancy: How Long You May Need to Wait

A mortgage after redundancy is a common concern for people who have recently lost a job or changed employment unexpectedly. Many assume redundancy automatically rules out mortgage approval for a long period, but lender decisions are more nuanced than that.

In practice, how long you may need to wait depends on your current employment status, income stability, and how redundancy fits into your wider financial picture.

This guide explains how lenders assess redundancy, typical waiting periods, and what evidence helps applications move forward.

---

Does redundancy automatically prevent getting a mortgage?

No.
Redundancy on its own does not permanently prevent mortgage approval.

What lenders focus on is:

• Your current employment and income
• Whether redundancy is now resolved
• How stable your finances are going forward

The key distinction is whether redundancy is in the past, ongoing, or unresolved.

---

How lenders assess redundancy

Redundancy that has already ended

If you were made redundant but are now back in employment, many lenders treat redundancy as historic rather than ongoing.

Underwriters will usually assess:

• Your new role and contract
• Your probation status
• How long you have been in the new job

The stronger and more stable the new employment, the shorter the waiting period tends to be.

---

Redundancy that is current or pending

If redundancy has happened recently and you are:

• Not yet back in work
• Working a temporary or short-term contract
• Relying on redundancy pay or savings

most lenders will pause until income is re-established.

Redundancy payments themselves are not usually treated as income for affordability.

---

How long do lenders usually want you to wait?

There is no single rule, but typical scenarios include:

Back in permanent employment

Many lenders will consider applications once:

• You have started a new permanent role
• You can provide at least one payslip
• Your probation period is acceptable to the lender

Some lenders are comfortable from day one of a new job, while others prefer to see one to three months of payslips.

---

Still in probation

Probation is not automatically an issue, but it can limit lender choice.

Some lenders:

• Accept probation with confirmation of permanency
• Prefer probation to be completed
• Look for a longer employment history in the same sector

Waiting until probation ends can widen options, but it is not always required.

---

Not yet back in work

If you are not currently employed:

• Most lenders will not proceed
• Waiting until income resumes is usually necessary

Savings or redundancy pay alone are rarely enough for mortgage affordability.

---

Does redundancy affect all lenders the same way?

No.
Lender criteria vary significantly.

Differences include:

• Whether probation is acceptable
• How many payslips are required
• How redundancy history is viewed in context

Some lenders take a flexible view where overall risk is low, while others apply stricter rules.

---

What evidence helps after redundancy?

1. New employment contract

A signed contract confirming:

• Permanent employment
• Salary and hours
• Start date

is one of the most important documents.

---

2. Payslips from the new role

Lenders typically want to see:

• At least one payslip
• Often two or three for wider acceptance

Payslips confirm income is actually being received.

---

3. Employment references or confirmation

A letter from your employer confirming:

• Your role is permanent
• Probation terms (if applicable)
• No concerns about ongoing employment

can strengthen applications, especially early in a new role.

---

4. Bank statements

Statements are reviewed to ensure:

• Income matches payslips
• Redundancy payments are clearly identifiable
• Account conduct remains stable

Clear separation between redundancy pay and ongoing income helps.

---

Does redundancy pay help with a mortgage?

Redundancy pay is generally:

• Not treated as income
• Acceptable as savings or deposit
• Useful for strengthening overall financial position

While it does not usually increase borrowing, it can improve resilience and deposit size.

---

What if your mortgage was declined due to redundancy?

A decline linked to redundancy does not mean approval is unlikely later.

However, reapplying without:

• New employment
• Evidence of income
• Time for stability to return

often leads to repeat declines.

You can learn more about employment checks in our guide on how lenders assess employment income.

Professional advice can help determine when your application is realistically ready to proceed.

---

Key takeaways

• Redundancy alone does not permanently block mortgage approval
• Lenders focus on current and future income stability
• Being back in permanent employment is key
• One to three payslips are often required
• Different lenders apply different waiting periods

---

This guide provides general information only. Personalised mortgage advice should always come from a regulated mortgage adviser.