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Salaried employee with commission and bonus - applying for FHA

I am applying for an FHA loan - I've been in the same line of work for 6 years, sales. Previous employer 3.7 years and current employer 13 months. I earn base plus commission with my previous and base plus commission and bonus on my current. The comp plan isn't the same, will the U/W use my bonus income because it hasn't been 2 years? by jensmc_832_401 from Concord, California. Oct 25th 2012 Reply


William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,588 contributions

You should not have an issue.. Since you have been in the same line of work for 6 years.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Oct 25th 2012
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Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,237 contributions

I agree with lbennett, shouldn't be an issue with the proper documentation, especially if your income for the past 13 months has been pretty consistent with what you earned at the previous job - or more. It will also depend somewhat on the strength of your overall application (debt ratio's, credit score and profile, reserves, etc.)

Oct 25th 2012
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Travis Torcoletti (travis.torcoletti)
#0 ranked lender in South Carolina - 372 contributions

Since you have been in the same line of work for 6 years they certainly should. They are going to ask you and likely your employer about your current compensation agreement and how it will work in the future.

Oct 25th 2012
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Bert Carpenter (BertCarpenter)
#38 ranked lender in Arizona - 1,821 contributions

It depends. If your old comp plan had commissions and bonuses, then the underwriter will use a 24 month average of each. If your old job was straight salary and the new one has commissions and bonuses, then the underwriter will probably not use either in qualifying you. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ Licensed in California and Arizona ~ www.LoansA2z.com 888-889-9950

Oct 25th 2012
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Peter Botros (PeterBotros)
#71 ranked lender in New York - 895 contributions

You should be fine. As far as the bonus, it will depend on if you had bonus pay in your previous job.

Oct 25th 2012
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Shashank Shekhar (shashank)
#665 ranked lender in California - 7 contributions

You should have earned bonus from the same employer for last 2 years to be counted towards qualifying income.

Oct 25th 2012
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Gianni Cerretani (mortgagegodfather)
#34 ranked lender in Georgia - 238 contributions

Most likely they will not use the bonus income if it has not been consistent for 2 years in the same line of work- not necessarily the same job. You will have to document that you received commission and bonus from the previous employer in order for it to count. Sounds like base plus commission minus bonus will be your allowable income.

Oct 25th 2012
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Thanks everyone for the feedback! My fico is 705 very stable income and employment and no more than 800.00 a month in total outgo including my wife's debt. I did not get any bonus from my previous job only base plus commission. I left that job because my new job that I've had for 13 months offers the bonus plan every time you hit quota. The bonus is pretty significant especially towards my income for the year. I did read that an U/W can use a bonus - if it's more than a year but won't be used if it's less. The employer wrote a letter identifying incomes on my VOE. What happens when jobs don't have the same comp plan?

Oct 25th 2012
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