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Will I be able to get a home loan if my income varies greatly? I am on a base + commission structure, so it really depends on the month.

by burke.c601 from Alpha, Ohio. Jun 8th 2016 Reply


Shawn Custis (scustis@fuse.net)
#94 ranked lender in Ohio - 6 contributions

use the base income and then take an average of the commission. That will be the number they use to calculate your ratios. www.columbiafinancialservices.net you can run a quick prequalify if you want.

Jun 8th 2016
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Tim Bradford (Tim Bradford)
#6 ranked lender in Ohio - 145 contributions

Burke, Your question is too general to give you a specific answer. When dealing with Commission income lenders typically need to look at an average of it over the last 2 years. Generally we will use a two year average and look for an increasing level of income. You will find my contact information on my profile page. I encourage you to call to discuss your specifics.

Jun 8th 2016
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Barb Lanis (BarbLanis)
#71 ranked lender in Illinois - 662 contributions

Assuming that you have received commission for a solid 2 years per your tax returns, a lender will use an average of your commission over 24 months. As long your as the total annual commission amount is of a consistent amount. The lender will verify the breakdown between base and commission directly with your employer. They will use your current monthly base + a 24 month average commission to qualify you.

Jun 8th 2016
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William J Acres (William_Acres)
#2 ranked lender in Arizona - 7,933 contributions

For scenarios like yours, the lender will take a 2 year average on the commissions if your year over year has increased.. if your year over year has decreased, then they will use the lower year divided by 12 months for income qualifying purposes.. This is only in reference to the commissions.. your base salary is added on top at its current rate. Understand that you need 2 years commission income in order to use commissions for qualifying purposes.. if you have less than 2 years, but more than 1 year, then it's possible an exception can be made.. If you want to know for sure, you should contact a LOCAL mortgage broker and apply with them. Once they see your complete loan profile, they will be better equipped to advise you properly. Also, by applying with your LOCAL Broker, you have an advantage because he's familiar with local customs and works with many lenders with each one offering a different type of lending program. This is unlike the local bank which typically only has a few lending programs. The more lenders, the more lending options, and the more likely your scenario will be accepted.. Plus, the broker is experienced in seeking out the best loan terms for your particular scenario, and he has lower overhead which typically results in lower rates and fees than most of the larger lenders.. 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. William J. Acres, Lender411's number ONE lender in Arizona. 480-287-5714 WilliamAcres.com NMLS# 226347

Jun 8th 2016
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Scott Fix (ScottFix)
#1330 ranked lender in California - 184 contributions

A lender will use an average of several months (24) to calculate your expected future earnings. You also may be asked to explain the peaks and valleys in the commission payments which, depending upon the industry you work in, may be very easy to explain and understand. All the best.

Jun 11th 2016
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