Both the period of pregnancy and maternity leave can be very financially demanding. Not all expenses will likely be covered from current income. For this reason, we may need a cash loan. It also often happens that future or new parents want to take out a mortgage to live in their own four corners, and not, for example, with their parents or in a rented apartment. However, the question arises: is a  loan possible during pregnancy or maternity leave? What conditions must be met to receive it?

Is credit during pregnancy or maternity leave possible?

Being pregnant or on maternity leave does not mean that the bank will automatically reject our loan application. However, we must be prepared that it will be harder to receive than under normal circumstances. Why?

There is always a risk that a woman will not decide to return to work after pregnancy and maternity leave, which will significantly reduce her income. The reason may be the desire to look after the child for a longer period, but also the fact that after a long absence from work, it will be difficult for her to find herself in it again, for example, due to changes in the manner of conduct and trends in a given industry.

As a result, the probability that it will not be able to pay its liabilities promptly will increase. The problem concerns mainly long-term and high-value loans, as in their case the stability of employment is an extremely important factor.

Pregnancy or maternity leave and a cash loan

A cash loan for a relatively small amount during maternity leave or pregnancy should not be a big problem, as long as we meet the basic requirements of the bank, so we have sufficiently high creditworthiness and positive credit history.

Cash loans are usually taken for a maximum of several years, so providing this type of obligation to a pregnant woman or on maternity leave is not a huge risk for the bank. However, the lender will likely require the prospective client to declare that she plans to return to work after the maternity leave (and therefore will not use the parental leave).

This is the case if we have a contract for an indefinite period or a contract for a definite period, but it ends after returning from maternity leave. The matter becomes more complicated if the period expires during maternity leave. The current law, aimed at the protection of pregnant women and young mothers, requires the employer to extend the contract in such a case at least until the maternity leave ends.

Thanks to this, a woman does not have to worry that she will be destitute when she will not be able to return to work. However, this solution will not work in her favor at the bank. It means that unless she finds a new job early enough, a potential borrower will probably lose her job for some time at the end of the maternity leave, This, in turn, will make it possible that she will not be able to pay off the loan on time, so the bank must take into account high risk.

Mortgage during pregnancy or maternity leave

Sometimes it is difficult to get a mortgage even under normal circumstances, it is easy to guess that pregnancy or maternity leave may be a problem. A mortgage is usually a liability for several dozen (even 35) years. It is impossible to be sure that during this period a person will always be able to repay the loan on time, therefore granting it is always associated with considerable risk. The precarious job situation related to pregnancy further increases them.

Fortunately, however, a mortgage during pregnancy or maternity leave is also not impossible. However, it may happen that the bank will require additional documents from us to confirm the stability of our employment.

These may include the previously mentioned own declaration of return to work after the expiry of maternity leave, but also, for example, a certificate from a doctor or employer. As can be expected, all other conditions traditionally associated with a mortgage will also apply, such as the need to have a sufficiently high own contribution.

How do pregnancy and maternity leave affect creditworthiness?

How the pregnancy (including sick leave related to pregnancy) and the subsequent maternity leave affect the creditworthiness depends on the rules adopted in a given bank. First of all, it is important whether the income from maternity allowance or sickness benefit is taken into account by a given bank at all, and if so, whether it is the main income or only additional income.

If such income is not recognized by the bank or recognized only as additional income, the chances of getting a loan are significantly reduced. In this case, the creditworthiness (i.e. primarily earnings) of the spouse or partner with whom we plan to commit will be significant. It will largely depend on its amount whether our loan application is accepted by the bank.

Loan during pregnancy or maternity leave – summary

The period of pregnancy and maternity leave is extremely demanding – not only mentally and physically, but also financially. We may be concerned that credit is not possible during pregnancy, but in fact, many banks are willing to grant it.

This may involve additional requirements or the need to have a co-borrower with sufficient creditworthiness, but it is not completely excluded. Importantly, nothing prevents you from applying for a mortgage during the maternity leave.