Qualifying Income and Why It’s Important

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Income requirements differ for Jumbo, FHA, VA, and Conforming Loans.

Why is this important? Here’s what you need to know for divorcing clientele:

  • Employment income must have a 2-year work history for qualifying purposes.
  • Spousal support income must be seasoned and must show continuance. Support income must continue for at least 2 years from the loan application date.
  • If support income decreases each year, we must use the 3rd year stated amount for qualification purposes.
  • Self-employed borrowers must have 2 years of self-employed income documented with federal tax returns. Income is derived from tax returns. Too many tax deductions could hurt the chances of qualifying.
  • If using child support to help qualify, this can be grossed up by 25%.
  • If the borrower is paying alimony, employment income can be reduced by the amount of alimony as opposed to showing it as a liability. This helps with debt-to-income ratios.

Contact Jan or CLICK HERE to schedule an appointment with me to learn more!


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