How will my income be viewed during the underwriting process?

Asked by Brent, Orange County, CA Mon Feb 27, 2012

I earned very little in 2011 and 2010 while living overseas; however, I`m a California CPA and looking to return home ASAP (I`m currently staying in NY). I`m looking for a condo in the low $100s, and my W-2 income should be ok to qualify me (over $5k month), but current position is seasonal through the end of April...while I believe I should be able to find a permanent position at the same salary or better, I may not be able to (nor do I particularly want to) until I`ve had a chance to move home and evaluate my options more thoroughly.

My question is will I have a chance of getting through the underwriting process in this situation? I`d like to do something with 3.5 -10% down.


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jjacobsDO, Landlord,
Thu Mar 1, 2012
My office has used the lender stated below on many reported instances and have received 95% lending on loan amounts up to $1,000,000 with NO MI, outstanding rate/term, and standard bank fees, all in one loan.
This loan is provided primarily to the Professional occupations listed below. Since you are a CPA you are eligible, and based on prior client scenerio you will not have to be on the job for any seasoning period.

Special note : I do not believe Condo's are allowed.

This Sr. Mortgage Banking Officer is Tom R. Callahan at BBVA and his e-mail

Tom has been assisting home buyers for over 27 years and is recognized on a national level with the Mortgage Bankers Association as a leader within the industry.

Good luck to you, TJ
1 vote
Jeremy Lehman, Agent, Garden Grove, CA
Wed Feb 29, 2012
Great answers below. I'll add that lender guidelines have loosened when it comes to FICO scores, but employment requirements have remained very strict and this will hurt. You may want to look at less conservative or flexible lenders for the best possible options.

Best of luck...
1 vote
Rene' De Bla…, , San Diego, CA
Tue Feb 28, 2012
If you have "self-employed" income over the past two years, in the same line of work (and continue to do so) underwriting will take a two-year average of your NET earnings.

Kinecta Federal Credit Union is one of a few credit unions in the country that is also a HOMEPATH lender.
1 vote
Mario Gonzal…, Agent, Riverside, CA
Mon Feb 27, 2012
Hello Brent !
I am with Jim & Lori on this. Underwriter will need to determine your likelihood of continued employment with your present job, and if its not at least 24 months, they can't consider it as a viable source of income.

1) If you don't have a household (wife and kids), consider renting a room, maybe from another professional with an extra room for rent - OC has great rooms for rent ! - April is but one month away... So you can get yourself a NEW JOB, pass the 3 month probation period and THEN be considered a full pledged employee... ready to get your Mortgage Loan !!!!
2) If you do have wife and kids, and they are coming over at the same time... then its a bit more sticky. You'd probably want to rent a home or apartment - unless you happen to have family or friends that can accommodate for about 6 months ??? - FYI : most homes / apartments want 12 month signed lease - minimum.

Most Kindest Regards,
Mario Gonzalez
JD Power & Associates Ranked #1 Buyer Satisfaction 2008, 2009, 2010
Chase Bank Preferred Agent 2008, 2009, 2010, 2011
Short Sale & Pre-Foreclosure Certified *
REO Buyer Agent & Distressed Property Certified
DRE LIC 01708214
1 vote
John Conklin…, , Scottsdale, AZ
Mon Feb 27, 2012

Assuming you meet all the other guidelines your move and change of employment should not impede the underwriting process. Typical seasoning for time on a new job is thirty to sixty day's and because you are a W2 employee they will factor your income based off of your current salary and not an average of the last two years. Keep in mind when you file your tax returns they will look at no-reimbursed expense on Schedule A and deduct that from your income as well as any Schedule C and Schedule E losses. Your situation is not a difficult situation but an easy one to screw up so choose your loan officer wisely. Hope that helps.
1 vote
, ,
Mon Feb 27, 2012
Brent, the lender is required to do either a verbal or written verification of employment. One of the questions that must be answered is the likelihood of continued employment. If your job ends in April that will not work on a traditional mortgage, that is a conventional or FHA loan that is underwritten for the secondary market.
1 vote
, ,
Mon Feb 27, 2012

There are numerous programs out there that can accomodate your situation. Two come to mind. FHA Loan & Homepath (Please visit & view Fannie Mae owned homes) - Both require minimal downpayment.

Underwriters are going to look at the entire picture - You might have heard of DITI or debt to income. It appears you can document $5k a month - what about any revolving debt? Car payments? Credit Card? Student loans? These will need to be taken into account. If you have no debt - you will be be allowed to use $2250 a month towards your housing expenses including principle, interest, tax & insurance.

A $200,000 condo with 3.5% down ($7,000) - Leaves you a mortgage of $193,000 @ 4.25% = Monthly payments of $949.44 + $208.33 taxes + $56.29 hazard ins, In addition, depending on the program - you might have to pay Mortgage Insurance. Check out Homepath - We are an approved lender & it's a great program.

Please feel free to call.

Grant Fawcett
Castle & Cooke Mortgage
Cell: (949) 212-4578
NMLS# 832635
1 vote
, ,
Tue Feb 28, 2012
Well the good news is that it does not take much income to qualify for a $100,000 condo, but yes we would be looking at your income carefully. If you have 2 years of W2 income that may be enough to get you qualified.
0 votes
Lori Hanson, Agent, Aliso Viejo, CA
Mon Feb 27, 2012
It sounds like renting for a while might be your best bet since your job here in CA is short term.
0 votes
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