As a house hunter, you are under no obligation to tell your lender that you are pregnant or plan to be pregnant. Pregnancy is not a legal reason for a lender to deny you a mortgage, unless your income ย changes in a way that makes you no longer qualified for the mortgage. I answered this question in 2008, when I was writing for Boston.com.
This is what I wrote (Reprinted from Boston.com by Rona Fischman ย November 11, 2008):
Hi Rona, โฆ I have a general question about mortgage approvals in these tight economic timesโฆ 1. How does pregnancy effect โฆ I am pregnant and currently am the head bread-winner in our family. I am due this winter and my husband and I have been trying to buy a home for over a year and half with little to no luck. We are hopeful that we might have some luck with the slower winter market, but we have been told by a mortgage broker that my being pregnant will negatively effect [sic]our pre-approval and we might get denied a mortgage as well. This doesnโt seem fair, or legal. Can you provide some insight? [emphasis mine] My first thought was discrimination! My second was about income. Lenders look for steady employment. If she has been steadily employed and will be through closing, the lender should look favorably on the loan. My lender-colleagues agree. One wrote: Tโs qualifications may be compromised if the closing on the home occurs during maternity leave. It will depend on whether Tโs pay continues at the same level, is suspended, or reduced during maternity leave. A lender may also want a statement of intent, verifying that T plans to return to her full time hours. This is allowed because the lender has the responsibility to evaluate T based on the correct amount of income. If T has already returned to work before the closing, the lender may just ask for a recent pay stub. The other wrote: In this case, part of the ability to repay the loan is demonstrated by the borrowersโ income and employmentโฆ If a borrower is unemployed at the time of closing, the borrower does not have an acceptable source of income to justify repayment of the loanโฆ If the borrower is employed, and receiving a paycheck at the time of closing, this is not an issue. If the borrower goes on maternity leave before closing, but the employer is still paying the borrower and will confirm with the lender that the borrower is actively employed, this should not be an issue. It is standard practice amongst lenders now, big and small, local or national, to verbally re-verify the borrowersโ employment status before closing. This is usually done within the last 3-5 business days before closing. He goes on: The Family and Medical Leave Act allows for people to take a leave of absence to raise a family, and have the option of starting back at their job after a period of time โฆ The difficulty with underwriting is that even though the borrower has the right to return to work, they may not. Medical leave or short term disability income canโt be used as regular income for the purposes of loan approval. Yet another added this: If Tโs application states she is and has been self employed in the same line of work or profession for the prior 2 years, her income would be determined by averaging business income from her most recent 2 years tax returns โ regardless of pregnancy/maternity. The lenders I asked resoundingly said it is wholly illegal to be told that pregnancy negatively effects a pre-approval. The Federal Trade Commission is clear that โa lender cannotโฆ ask about your plans for having a family.โ Thank you to my sources at Asset Mortgage Group, Mortgage Master and Monument Mortgage.