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Documenting Income

In general, the previous two years of income history is required for underwriting approval.  In addition to this, underwriting requires recent income to be documented as well so we can comply with federal regulation.

Last two years *Signed* 1040’s:

  • These are the forms that you file with the IRS and are 2 pages long.  State taxes are not needed. If the copy you have isn’t signed you can sign it now.
  • Do you have an accountant that prepares these for you?   If so it is usually more convenient to have them email you a PDF version of your taxes and is usually free.
  • If you have filed for an extension on your taxes you will need to document that with a copy of your signed 4868 extension.
  • If you are “Self Employed” please see the list below.
  • If you receive “Other Income” please see the list below.

All W2’s for the past 2 years:

  •  Even if you were part time at an employer or only made minimal income.  All W2s are required. Unemployment 1099Gs are also required if you were unemployed anytime during the past two tax years.

30 Days income from a paycheck stub with Year to Date (YTD) earnings reflected:

  • These are required on all loans.  They will show the company name and address, your name and address, pay date, taxes and other deductions.  If you do not get copies you will need to reach out to your HR department to get them.
  • To make sure our team will have 30 days income please follow these instructions: If paid weekly send your last Five (5) pay stubs; if paid bi-weekly send your last Three (3); If paid monthly send your last Two (2).

Contact name and phone number to verify your employment: 

  • Please verify that the number you provide is accurate.  A wrong number could lead to delays in closing you loan.

Are you Self Employed or Receive Rental Income?   If so please follow the list below.  The easiest way to get this documented is to have your accountant or tax professional email you a copy of your last two tax returns.
  1. Last two years full taxes with all schedules & attachments.
  2. Name, Phone Number and Email for you accountant or tax preparer.  This will allow our team to reach out to them directly if any questions should arise.  Please give them a heads up that they may be contacted by us for the purpose of securing a mortgage.
  3. Year to Date (YTD) Profit and Loss.  This will show your current Income and Expenses and is required by the underwriter.  If you do not have one prepared, you can download a generic template HERE.

Other income types:

If you answer “Yes” to the following questions please follow the instructions below.

Do you receive alimony, child support or a separate maintenance?

  • Please document how and when you receive payment.  In order to use the income to qualify for underwriting purposes we will need to show the last 12 months history and prove that the payments will continue for 36+ months.  If you receive child support infrequently or in cash and cannot document it, the income cannot be used.  If your payment agreement ends or you become ineligible to receive the income within the next 36 months the income can only be used as a compensating factor not to qualify for the loan.

Do you receive Social Security or Disability income?

  • To Document this please provide an “Award Letter” or “Benefit Verification Letter.” If you do not have one or lost your copy you will need to request a new one from Social Security.  Call 800-772-1213 or go to socialsecurity.gov/myaccount to order your letter.

Do you receive an annuity distribution or retirement account recurring payout?

  • We will need to document what gets paid out and when in writing from the institution making the distribution.  We will also need to show that the payments will continue for 36+ months in order to use the income to qualify.

Do you receive rental income?

  • This will be documented on your 1040’s “Schedule E.”  We will also need to document the Mortgage Payment (if any) with a Mortgage Statement.  The most current year Tax Invoice(s) and Insurance Invoice(s) will also need to be provided so that an accurate account of your debts can be assessed.  Addition documentation may be required including leases or cancelled checks depending on the time the rental property(s) have been owned.