Non-Taxable Income

 In Qualifying for a Mortgage

Do you have non-taxable income, such as Social Security payments, child support payments, or non-taxable pension income? If so, did you know that we can count more income than you actually make when qualifying you for a mortgage?

Here’s what you need to know.

Conventional Loans

For conventional (non-government) loans, we can increase the amount of the non-taxable income by 25%.  If you are in a high tax bracket and pay more than 25% of your income in federal and state taxes, we can increase the non-taxable income by that higher percentage.  

We need to document that the income is in fact non-taxable and is likely to continue in a non-taxable status, but that is easy to do by looking at award letters, account statements, policy agreements, or any other documentation that verifies the income is non-taxable.

FHA Loans

For FHA loans, we can increase the amount of the non-taxable income by the greater of 15% or the percentage you actually paid the previous tax year.

Depending on how large your non-taxable income is, the additional amount we are allowed to add can significantly increase the amount you qualify for.  When you choose us as your lender, you can be sure we know all the rules and will maximize the amount you can borrow. Contact us now to get started.

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