+1 vote
My loan processor told me that he just submitted my file to underwriter but his only concern is if the underwriter will consider my commission income or not(Without commission income, my debt to income ratio is about 60%).
My income pattern for past 3 years is below:
2015 - 62,000(40k base and 22k commission)
2016 - 128,000(78k base and 50k commission)
2017 - 175,000 (100k base and 75k commission)
But I joined this new company in April 2017. So my processor isn't sure if this will be taken into account or not.
Can you please advise what the possible outcome might be and what can I do to get the mortgage?
Also, is it possible to get a piggyback on this if they offer a lower loan amount?
Please advise.
asked Dec 21, 2017 in Conventional Loans by Shah

2 Answers

+1 vote
The great thing is that our commission income has risen steadily each year. If you are in the same industry and a similar position, and your salary is guaranteed (and also higher), I don't see a problem. It;' what we used to call "make sense" lending. However, as your processor noted, this can be a judgment call for the underwriter. Put it this way -- if this lender says no, there are likely to be others perfectly willing to say yes.

In fact, Fannie Mae's guidelines state, "A minimum history of 2 years of commission income is recommended; however, commission income that has been received for 12 to 24 months may be considered as acceptable income, as long as there are positive factors to reasonably offset the shorter income history."
answered Dec 24, 2017 by GinaPogol (47,650 points)
0 votes
If you are commission income, need two years income averaged. If it is declining income, then the last lower year is used and averaged by 12 months. On your case is inclining income so 24 months will be averaged. Issue here is you just started new job. If you had same type of jobs, like real estate agent or loan officer then the 2 years commission income will be average. However if you go from selling cars to selling real estate then 2 years income selling real estate is required.

Gustan Cho NMLS 873293
The Gustan Cho Team at USA MORTGAGE
www.gustancho.com
answered Feb 6, 2018 by GustanCho (106,540 points)

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