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USDA question concerning my child

Can USDA underwriters ask for my child's, who is 17, W-2 and pay stubs even tho she only works a few hours a week and can it affect my loan?? by buzzing_bee71728 from Andrews, North Carolina. Oct 17th 2013 Reply


USDA Rural Development Income GuidelinesFirst, the annual income of all household members is calculated. Then, certain household deductions for which the family may qualify are subtracted from annual income to compute adjusted income. oAnnual Income is the amount of income that is used to determine an applicant's eligibility for assistance. Annual income is defined as all amounts, monetary or not, that go to, or are received on behalf of, the applicant/borrower, co-applicant/co-borrower, (even if the household member is temporarily absent), or any other household member; all amounts anticipated to be received from a source outside the family during the 12- month period, all amounts that are not specifically excluded by regulations, and amounts derived (during the 12-month period) from assets to which any member of the family has access.

Oct 17th 2013
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,558 contributions

Yes.. under the guidelines for USDA all the HOUSEHOLD income is considered in your qualifying, since the government has maximum household income limitations for USDA loans.. If she's only working a few hours a week, it's unlikely her additional income would push you above the maximum.. .. 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 17th 2013
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Elden Lewis (elewis_409_299)
#42 ranked lender in Indiana - 223 contributions

The short answer is yes. The USDA Rural Development must consider all income in the household to make sure the household doesn't exceed the income limits.

Oct 17th 2013
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They are required to disclose all household income and so they do need your child's information. There are two prongs of the income analysis. The Debt to Income which lender does and will not include your child's information and the Income analysis for qualification in the program. This child is counted into your family size so your amount allowed is increased due to having family size of 3 (or more if there are other children). It is unlikely the amount the child is making would disqualify you. The Lender submitting loan to USDA office should have used income for all family members. It would be disclosed on Tax Returns regardless and require inclusion. The lender application only uses the income of those on loan for qualification, but USDA needs to look at total income of all members of house for program inclusion. For family size upto 4 is 74750 for Cherokee County on the USDA Guarantee program. You did not indicate if this was s DIRECT USDA loan or Lender Guarantee Program. The Direct programs for Low and Moderate Low Income are much lower. 42050 and 26350 respectively. YOUR LENDER SHOULD BE ABLE TO ADVISE INCOME THEY SUBMITTED ON LOAN and if you are close to it impacting you being program eligible.

Oct 17th 2013
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As noted by first reply, the answer is short answer is YES. I hope I clarified why the household income is required and you can goto the USDA website at:http://www.usdaloans.net/usda-home-loan-income-eligibilityFor additional USDA information and guidelines.

Oct 17th 2013
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John Beman (AmFirstLending)
#555 ranked lender in California - 38 contributions

Yes they can ask for the W-2, if you have included your childs W-2 income on your 1040 tax returns. However, since the child is not of legal age, they could not be put on the loan or in title, so the underwriter is incorrect in asking for the paystubs. The child's income is irrelavant and doesn't matter as can't be included in the qualifying income for the loan. The only other instance that I can think of that they may want to see that income is if you are trying to exclude a debt that you state is being paid by the child. Then they may want to ensure that the child makes enough income to pay that excluded debt without financial assistance from you. Good luck.

Oct 17th 2013
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It is true. USDA qualifies borrowers on total household income. I'm sorry you're lender didn't use all the income to calculate total income before it went to USDA. I hope you haven't spent a lot of money on this deal.Fannie Mae has a 97% loan that might work. It's surely better than an FHA loan in most instances. Perhaps ask your lender about it.I hope it all works out for you.

Oct 17th 2013
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Yes USDA can request info because she lives in the house. USDA uses total household income Yes it can have a impact on the mortgage if household income exceeds USDA allowable for your county.

Oct 17th 2013
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