What Lenders Require Depending On How You Are Paid

What Lenders Require Depending On How You Are Paid

 What will be needed to purchase a home. Below is breakdown of the most common income types and what documentation is required to utilize them.

Salary/Hourly- This is often referred to as a W-2 income within the mortgage industry. This income is the typically the easiest to use. The lender verifies it by requiring paystubs, tax returns, and a verification of employment.

Self-Employed- This income source typically comes with a 1099 for your taxes. It is much more difficult to use this income. It is essential to have a two year history of self-employed income from the same industry and/or company. You also will need tax returns, two years of 1099s, and a current YTD balance sheet and P&L if utilizing FHA financing.

Tip Income- This is very common in the service industry. Tip income is usable if there is proper documentation. As with self-employed income, you need two years history to be able to utilize it. You also need to have paystubs that reflect earnings from the previous two years, a current paystub that reflects YTD earnings, W-2s from employer, and a verification from your employer that breaks down your tip income.

Seasonal- A seasonal job would consist of working in a department store during the holiday season or umping baseball games in the summer. In order to utilize income received from these positions, you must have two years history in the same type of job. You also must be able to reasonably assure the bank that the income is expected to continue.

There are numerous different income types out there. Speak with me if you have any questions regarding the requirements to utilize this income.

Source:

Andrew Augustyniak
 Branch Manager

 NMLS: 911628
 Office: 602-601-3863 
 Mobile: 480-735-4095 
 Fax: 866-908-2760

 Prime Lending

1820 East Ray Road

Suite A114

 Chandler, AZ 85225

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Phone: 602-549-9242
Dated: May 16th 2018
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About Penny: Buying and selling a home is a very important event in your life. Whether it be your first home, a ...

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