Last two years tax returns...and income this year

[jessica04]

When the mortgage lender asks for the previous 2 years tax returns are they using that income for the basis of what amount of loan you qualify for? The reason I ask is because I'm wondering what happens in the situation where someone made the same amount for last 2 years but this year their income is 10,000 more annually? Do they use your current income?

[tooleman694]

I think they are going to average it out.

[basballguy]

why wouldn't they use your paystubs?

[namvet]

When a mortgage lenders asks for the last 2 years tax returns and year to date income, it usually means that the borrower is self employed.  The income used to qualify is averaged.

[jessica04]

I have never been self employed, but they want 2 years tax returns, w2's, and last two paystubs

[tooleman694]

They wanted 2 years from me too, and im a W2.

[Draco007]

They are also looking for non-reimbursed business expenses you may have taken as deductions.  They subtract these from your income when qualifying.