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Income Verification For A Loan or Autoloan...

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Andy77
Valued Contributor

Income Verification For A Loan or Autoloan...

 

 

So I was talking to a credit union loan officer on the phone and I told them this year I am getting money, in addition to my salary from work, for selling farmland I will include this on my application.  She then said...well how can we verify that?

 

I said...one of three ways....

 

1.  the canceled check,

2.  the money I deposit in my credit union account is the exact same amount of the check 

3.  a letter stating what I got the check for, a farmland sale.

 

She said...not sure that will work

 

I don't see how this income is different from a real estate agent's income..theirs varies from year to year...and obviously mine is too....

 

Do you think this loan officer did not know what she was talking about?

Message 2 of 10
9 REPLIES 9
Andy77
Valued Contributor

Auto Loan Income Question...

 

I am getting a CPO soon and on the application I am going to include income that I am getting in 2015 from the sale of some farmland.  Obviously I have to pay taxes on the money I get, however, I don't get this amount every year, its a one time thing.

 

If I include it on my application and they ask for income proof...do you think a letter from the lawyers representing the deal that states I got the money because of a sale or a copy of the cancled check will be OK ?  

 

I would prefer to do the canlced check as proof

 

(I cant use tax return since I would not have done 2015 yet)

 

 

Thanks

 

 

Message 1 of 10
gdale6
Moderator Emeritus

Re: Income Verification For A Loan or Autoloan...

The only thing that will prove that income is your tax return for this year and then again only if you show a profit on the property thru a capital gain. Its quite different from the income of a RE agent they are either self employed or form their own corp/llc and draw a paycheck.

Message 3 of 10
Andy77
Valued Contributor

Re: Income Verification For A Loan or Autoloan...

 

 

This is farmland that has been in my family since 1880....no mortgage.

 

I can't show a tax return if I have not filed my taxes yet.

 

I will get a K1 in 2016

 

So, back to my original question...since I legally have to pay income tax on the money I get in 2015 ...I don't see any problem reporting it on the app...I for sure can prove I got it and why I got it

 

Now if I got the car in 2016...in May...after taxes are done I could show it on my return then...but not until then

 

Do you see anything wrong here ?  As I said...I can't produce a tax return that has not been generated....

Message 4 of 10
UncleB
Credit Mentor

Re: Income Verification For A Loan or Autoloan...


@Andy77 wrote:

 

 

This is farmland that has been in my family since 1880....no mortgage.

 

I can't show a tax return if I have not filed my taxes yet.

 

I will get a K1 in 2016

 

So, back to my original question...since I legally have to pay income tax on the money I get in 2015 ...I don't see any problem reporting it on the app...I for sure can prove I got it and why I got it

 

Now if I got the car in 2016...in May...after taxes are done I could show it on my return then...but not until then

 

Do you see anything wrong here ?  As I said...I can't produce a tax return that has not been generated....


I don't think you're doing anything wrong at all, but the lender has the right to request whatever documentation they want.  You also have the right to go elsewhere for your financing needs should a lender be too difficult to work with.

 

I'm a bit surprised your CU is being so picky... especially since they can see the deposit in your account in their own institution.  I've bought lots of cars on credit over the years, and the only time I've been asked for any income verification docs was when I used Capital One's "Blank Check" a couple of times.  Those two times I did have to fax over copies of my pay stubs, but that was expected due to the nature of the loans.  When I've been at a dealership, or even a brick-and-mortar bank branch where I had an account, they've never asked for anything other than to photocopy my DL and to complete the application.  Very painless, actually.

 

Message 5 of 10
Andy77
Valued Contributor

Re: Income Verification For A Loan or Autoloan...

 

 

 

Thank you for the reply...

 

No I am just saying worst case scenario and they ask for income proof....this is a new credit union and I would join, deposit the check for 116k, open a cd checking, savings, and take out the auto loan app

 

I am looking to get a 51k car with 20k down..... (that 20k is coming off the 116k)

 

 

Message 6 of 10
Anonymous
Not applicable

Re: Income Verification For A Loan or Autoloan...

Can you tell us a little more about the money you will be receiving?  It's clear that some farmland. which has been in your family for generations, is being sold and that you will be getting a share of the proceeds.  (Perhaps all of it, perhaps it is being split between say you and your siblings.)

 

What may be confusing the loan officer is that you have described it to her as "income."  She may be thinking that you mean taxable income: for example if you were in the business of buying and selling properties, then you'd generate a variable amount of income per year through the sale of property, which you'd pay tax on.

 

But it's quite possible that it is not taxable income at all.  For example, if it is farmalnd that belonged to an uncle who is dying and who's estate is settled on you and two other people, then you expect to be receiving money from the sale of the land but it is not "income" in that sense of the salary one gets from a job.  It's just money that you expect will be arriving in your checking account later this year.

 

Or it could be property that you and your brother have owned for 20 years.  If you are selling it for more than it was originally valued it, then you will owe a capital gains tax on the extra amount.  Still the bulk of the sale won't be taxable at all.

 

It may be easier for people to advise you if they understand better what's going on with this particular sale.  BTW, can you give us an estimate as to when you think you'll be getting the money?  And are you trying to get a loan prior to that money coming through?

Message 7 of 10
Anonymous
Not applicable

Re: Auto Loan Income Question...

When lenders ask for income verification (which if your score is good and you go directly to a dealership, they may not require proof) they want prior income statements, not future ones. If you are self employed and do not get paychecks, if they want income they will ask for your 2013 and 2014 tax returns.

 

If you go to a bank looking for financing for an unknown vehicle, they will be more likely to ask for proof. The best thing to do would be to find a vehicle at a dealership that works with several lenders and advertises that they work with all credit situations (meaning that they deal with more than just prime banks) and then request financing for the vehicle. Dealers want the sale to go through just as bad as you do and they will work to get you financed and they are professionals that do it every day.

Message 8 of 10
gdale6
Moderator Emeritus

Re: Auto Loan Income Question...

I have merged your cross posted thread from the auto forum into this thread. Please refrain from posting the same topic in multi forums. I thank you for your understanding.

Message 9 of 10
RobertEG
Legendary Contributor

Re: Income Verification For A Loan or Autoloan...

As this is a one-time asset, I would presume they are not considering it as they would recurring "income."

It is not going to repeat.  It is more akin to a gift or inheritance, and thus primarily a factor in your assets to debts ratio.

It's relevant to their loan approval, but not, in my opinion, as income, other than the fact that it is taxable.

 

I am thus perplexed as to why they would care where it came from.  It is cash in the bank.

 

Message 10 of 10
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