Bonus Income

[sherizel73]

I keep reading that you need 2 years of bonus income for it to be included as income.  Do the 2 years have to be at the same job?

Job 1 March 2015 bonus  $14,000  

Job 2 March 2016 bonus  $11,000  Same job and industry as job 1, just new company, same bonus structure as year before. Bonus is less because it was prorated since I didn't start until March.

          March 2017 bonus  $15,000  This is an estimate. I received a promotion and have this bonus structure in writing. 

Can any of this income count towards DTI?  If so, how much, maybe just the $11,000 or would it be averaged? 

Thanks.

[dursty87]

I was in the same boat as you when I applied for a mortgage. I have always had bonus income yet it was with 2 different companies over the previous 2 years. My lender just averaged the bonus between the 2 years(which from what I understand is the norm) and it was calculated as part of my income which helped my DTI.

[DallasLoanGuy]

should be ok.

expect scrutiny.... but the uw is just covering their butt.... i have seen these go thru pretty regular.

[Anonymous]

It's a harder sell to UW when bonus is going down. They will use the $11,000 at best and not average. Since you have something on the 2017 bonus in writing it should help since it is going back up. 

[sherizel73]

Keep in mind though the only reason the bonus went down was because it's prorated because I didn't start until March.  I'm not sure the UW would take that into consideration but the bonus didn't go down due to a decrease in salary or other factors, it was strictly just timing. 

[Anonymous]

---

@sherizel73 wrote:

I keep reading that you need 2 years of bonus income for it to be included as income.  Do the 2 years have to be at the same job?

Job 1 March 2015 bonus  $14,000  

Job 2 March 2016 bonus  $11,000  Same job and industry as job 1, just new company, same bonus structure as year before. Bonus is less because it was prorated since I didn't start until March.

          March 2017 bonus  $15,000  This is an estimate. I received a promotion and have this bonus structure in writing. 

Can any of this income count towards DTI?  If so, how much, maybe just the $11,000 or would it be averaged? 

Thanks.

---

If you are at the same job you had last year, and you were paid the bonuses last year, it will count. For salaried employees they look at your current income, but current bonuses will only count if you received them last year as well. My income 2 years ago was 27k, but my current income without bonuses is 160k. I do get 20k in bonuses now but I didnt last year, so they didnt count. The approved me for 600k.

I would imagine up to 14k in bonuses will count, since thats what you got last year. That is assuming however you can prove you will get at least 14k in bonuses this year.