Income Concepts

Just because you have been paid a certain amount of income recently, it doesn’t mean a lender can allow for that income to be used for obtaining a home loan.

The Dodd Frank Law requires lenders who want to achieve safe harbor loans to use certain rules for counting the stability of a borrower’s income.

One benefit of most doctor loans is the ability to use future income from a signed employment agreement as long as that contract guarantees a monthly income for at least 12 months.

Salary borrowers are easy for a lender to calculate, but please know if you receive bonus or overtime income, that income is not allowed unless you have earned it for at least 2 years of this documented income on tax returns. Moonlighting or 1099 income must be reported for 2 years on the tax returns in order to meet stability or continuity of income requirements.