Employment Verification
Employment verification is the process by which mortgage lenders confirm a borrower's current employment status, job tenure, income level, and likelihood of continued employment. This verification typically involves direct contact with the employer and review of supporting documentation.
What This Means
How Lenders Verify Employment
Lenders verify employment through multiple methods, often using more than one approach for a single application:
- Verbal Verification of Employment (VVOE) - a phone call or electronic verification to the employer confirming the borrower's current employment status, typically performed within of closing
- Written Verification of Employment (VOE) - a formal document completed by the employer detailing job title, hire date, compensation structure, and year-to-date earnings
- Third-party verification services - automated platforms such as The Work Number (Equifax) that provide employment and income data directly from employer payroll systems
What Lenders Look For
Lenders evaluate employment stability and income continuity. Key factors include:
- Length of time with current employer (generally of employment history is reviewed)
- Consistency of role and compensation
- Probability that income will continue for at least three years
- Any recent job changes, gaps, or transitions between industries
Gaps in employment require written explanation and may trigger additional scrutiny. Job changes within the same field are generally acceptable, while career changes near the time of application can complicate qualification.
Self-Employed Borrowers
Self-employed borrowers face a more rigorous verification process. Instead of employer verification, lenders require business documentation including tax returns (typically ), profit and loss statements, and sometimes business bank statements. The lender may also verify the business is active and operational through a third-party business verification service or independent confirmation.