Maternity & Parental Leave

Maternity leave mortgage: qualify on your full salary, not just your EI.

The right lender will use your guaranteed return-to-work income with a simple employer letter, so a temporary leave doesn’t cost you the home you’re ready to buy.

Qualify on return salaryEmployer letter handledBuy or refinance on leaveNot limited to EI incomeFirst-time-buyer friendlyInsured-purchase compatible

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Written by the Mortgage Squad Advisors Editorial Team · Reviewed by Surrayya Afzal, Principal Broker, FSRA #M14001433 · Updated June 2026

Worked example · parental leave

EI or my return-to-work salary?

Return-to-work salary$90,000

EI while on leave (yearly)≈ $37,908

Max mortgage on EI only$112,938

Max mortgage on your return salary$374,141

Difference≈ $261,203

Illustrative: qualifying at the 6.14% stress-test rate (4.14% 5-yr fixed + 2%, as of 6 October 2026), 25-year amortization, semi-annual compounding, 39% GDS with $500/mo property tax and heat, no other debts. Standard EI pays 55% of earnings up to $729/week. Not a quote; lenders differ on how they treat leave income.

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It’s a frustrating moment: you’re financially ready to buy or refinance, but you’re on maternity or parental leave, and your bank looks only at your reduced EI benefit and says no. Here’s what most people aren’t told: many lenders will qualify you on the full salary you’ll return to, provided you confirm your return. With a short employer letter stating your guaranteed return date and salary, the right lender treats you as the earner you are, not the temporarily-reduced one. A growing family shouldn’t have to put home plans on hold over a paperwork technicality.

Two people signing mortgage documents beside a set of house keys

On this page

Can you actually qualify for a mortgage while on maternity leave?
What does the employer letter need to confirm?
How are EI parental benefits and an employer top-up treated?
Why do some lenders decline maternity-leave borrowers?
How should you time and document a mortgage on leave?
FAQ

Can you actually qualify for a mortgage while on maternity leave?

Yes — and the answer hinges on one thing most people are never told: how a lender chooses to read your income. Being on maternity or parental leave is not a disqualifier in Canada. The obstacle is that a temporary leave reduces your current cash flow, and a cautious branch may treat that reduced EI benefit as your real income.

The right lender does the opposite. It qualifies you on the full, guaranteed salary you will return to — your pre-leave income — provided you can confirm that return. The mechanism is simple: an employer letter stating your position is held, your return date, and the salary you’ll resume. With that in hand, lenders that accept return-to-work income treat you as the earner you genuinely are.

In files we see, the gap between these two approaches is often the difference between a flat decline and a clean approval at full buying power. Knowing which lenders take which view is the entire game, and it’s where a specialist broker earns their keep.

What does the employer letter need to confirm?

The employer letter is the document that most strengthens a leave file, so it’s worth getting exactly right the first time. At minimum it must confirm four things: your position and that the role is being held for you; your guaranteed return-to-work date; the salary (or hourly rate and weekly hours) you will return to; and that your employment is continuous and ongoing.

Many lenders also like to see how long you were employed before the leave began, which establishes tenure and stability. The letter should be on company letterhead, signed and dated by HR or a manager, and free of conditional language — “expected to return” is weaker than “will return on [date] to [position] at [salary].”

We give you a precise template so your HR department can produce it in minutes rather than guessing at what underwriters want. A vague letter is the most common reason an otherwise-strong leave file stalls, and it’s entirely avoidable.

How are EI parental benefits and an employer top-up treated?

Your current EI benefit and any employer top-up matter, but they are usually not the figure that determines your approval. EI maternity and standard parental benefits pay 55% of your average insurable earnings up to a weekly maximum ($729 a week in 2026), and extended parental benefits, which stretch the leave to up to 18 months, pay 33% up to $437 a week in 2026¹. On an 18-month leave your return date may fall outside some lenders’ window, so lender choice matters even more. When a lender accepts return-to-work income, your full pre-leave salary is the qualifying number — EI is simply confirmation that you’re currently on a legitimate, documented leave rather than out of work.

Some lenders take a more conservative route and will use, average, or blend your EI plus top-up instead of your return salary; that approach almost always shrinks your buying power and is precisely the kind of file we steer toward a more flexible lender. If your employer provides a top-up that brings your leave income close to full pay, that can strengthen the picture, but it’s rarely necessary when the return letter is solid.

The key point: don’t let a branch convince you that your reduced EI deposit is the ceiling on what you can borrow. It usually isn’t, with the right lender.

Why do some lenders decline maternity-leave borrowers?

It’s a genuinely frustrating experience, and it happens more than it should. A front-line branch officer often works from a single, conservative playbook: they pull your recent pay deposits, see a reduced EI amount, and conclude you can’t support the payment. They’re not necessarily being discriminatory — they’re applying one lender’s narrowest reading and have no incentive to shop your file elsewhere.

But the result feels like a penalty for starting a family, and that’s wrong. Among the 100+ lenders we work with, many explicitly accept return-to-work income with a proper employer letter, and we know which ones move quickly on leave files versus which ones quietly average everything down.

You are not obligated to accept the first “no.” A decline at one institution says nothing about your file’s strength — only about that institution’s appetite. As an FSRA-licensed brokerage (#13737), our job is to find the lender whose policy actually fits your situation, and to do it without judgment.

How should you time and document a mortgage on leave?

A little planning makes a leave file straightforward. First, timing: you usually don’t need to be back at work before closing. Many lenders will use your full return salary if your confirmed return date falls within their window, often within about 12 months. If your return is further out, some lenders use only part of your income or want savings to cover the gap, so your return date does affect which lenders fit.

Apply when you’re ready to buy or refinance, not around your return date. Second, documentation: line up the employer letter early, plus recent pay history showing your pre-leave salary, your record of employment, and confirmation of your EI benefit. A complete package means the file approves the first time instead of bouncing back for clarifications.

Third, consider a co-applicant — a partner’s income combines with your return-to-work salary so the household qualifies on its true earning power, and sometimes their income alone carries it with yours as support. The broker advantage ties it together: we know which lenders say yes, we package the file to their exact standard, and we disclose every lender and broker fee in writing upfront. We also serve clients in 15+ languages, so nothing gets lost in translation.

What you get

Why Canadians choose Mortgage Squad Advisors.

Qualify on your full guaranteed return-to-work salary, not just your EI benefits

A simple employer letter (return date + salary + position) unlocks it

Works for both a purchase during leave and a refinance while you’re off

Pairs with first-time-buyer programs (FHSA, RRSP HBP) and gifted down payments

Available on insured purchases with as little as 5% down

We know which lenders are most leave-friendly — and which ones aren’t

Spousal/partner income combined so the household qualifies on its real earning power

No need to rush back to work early just to satisfy an underwriter

Clear documentation package so the lender has everything it needs the first time

All lender + broker fees disclosed in writing upfront

How it works

Three simple steps, no pressure.

Confirm your return

Tell us your leave dates, your normal salary, and your planned return. The key document is a letter from your employer confirming your position is held, your return date, and the salary you’ll return to. We tell you exactly what it needs to say.

Match a leave-friendly lender

Not every lender handles parental leave the same way — some average EI with return income, the best ones use your full return salary. We place your file with a lender that qualifies you on your real earning power, and disclose rate, term, and fees in writing.

Approve + close

With the employer letter and your income confirmed, we submit the file and, once approved, your lawyer closes — whether that’s a purchase or a refinance. You move forward on the timeline that works for your family, not your underwriter.

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FAQ

Common questions, answered.

Don’t see yours? Ask Maya — instant answer, any time.

Can I really get a mortgage while on maternity or parental leave?

Yes. Being on leave doesn’t disqualify you; the issue is only how income is assessed. Many lenders will use the full salary you’re returning to, as long as you confirm your return with an employer letter. The trick is choosing a lender that does this rather than one that looks only at your reduced EI benefit. That lender choice is exactly where we add value.

What does the employer letter need to say?

It should confirm that your employment continues, your position is being held, your guaranteed return-to-work date, and the salary (or hourly rate and hours) you’ll return to. Some lenders also want confirmation you were employed there before the leave. We give you a clear template so your HR department can produce it quickly.

Will the lender use my EI income or my regular salary?

The best lenders qualify you on your full return-to-work salary when you confirm your return — your EI benefit during leave isn’t the ceiling. Some lenders take a more conservative approach and average or use the lower figure, which is why we’re selective about where we place your file. In files we see, the difference can be tens of thousands in buying power.

Can my partner’s income carry the application?

Yes. If you’re applying jointly, your partner’s income combines with your return-to-work salary so the household qualifies on its true earning power. In some cases the partner’s income alone is enough, with yours as support. We structure it whichever way approves cleanly.

Can I refinance while on leave, not just buy?

Absolutely. The same principle applies — return-to-work income with an employer letter — whether you’re purchasing or refinancing. Many families refinance during leave to consolidate debt or access equity for the new arrival’s expenses. We treat a leave refinance exactly like any other, just with the return-income documentation.

Do I need to be back at work before closing?

Usually not. Many lenders will use your full return salary if your confirmed return date falls within their window, often within about 12 months, so you usually don’t have to cut your leave short. If your return is further out, some lenders use only part of your income or want savings to cover the gap, so tell us your return date up front.

What if I’m self-employed and took time off?

Self-employed leave is handled differently since there’s no employer letter. Lenders typically look at your historical business income and how the business continues during your time off. It’s very workable — see our self-employed mortgage page for how stated and documented business income is assessed, and we’ll combine that approach with your leave situation.

Does being pregnant or planning a leave affect my approval?

Pregnancy itself isn’t an underwriting factor. Lenders assess income, so if a leave will start before closing, tell us up front and we’ll document your return-to-work income from the start rather than risk an issue at final approval. What matters is documented, continuing income. If you’re planning a leave, we’ll structure the file around your confirmed employment and salary so the timing of your family plans doesn’t work against you.

Can I combine this with first-time-buyer help?

Yes — leave-income qualifying stacks with everything else. FHSA savings, the RRSP Home Buyers’ Plan, a gifted down payment, and first-time-buyer rebates all still apply. Start with our first-time home buyer page for the full set of programs and we’ll layer in the return-to-work income approach.

Related products

First-time home buyer Gifted down payment Self-employed mortgage Affordability calculator Payment calculator HELOC (equity access)Renewal strategy Refinance overview

Sources & references

Figures on this page are sourced below and re-checked each quarter. Rates, insurer rules and lender policies change — confirm anything you plan to act on with a licensed advisor.

1. Government of Canada, EI maternity and parental benefits: how much you could receive (accessed September 2026) — Maternity and standard parental benefits pay 55% of average insurable weekly earnings up to $729 a week in 2026; extended parental benefits pay 33% up to $437 a week in 2026.

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