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AGI for mortgage?

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jzsnow
Frequent Contributor

AGI for mortgage?

Do lenders use your AGI or just gross income to determine dti and affordability?
Message 1 of 6
5 REPLIES 5
JM-AM
Valued Contributor

Re: AGI for mortgage?

It depends on a few different things...

 

Self Employed ... averaged over last few years

 

W2 employed generally is gross unless a big (determined by lender) difference from one year to the next in pay.

Good Luck
May all your dreams and wishes become a reality!
Message 2 of 6
Vwaller72
Valued Member

Re: AGI for mortgage?

I'm no expert but I don't think there's any case where they use your AGI. That's something that really only matters for tax purposes as AGI is the portion of your income that is actually taxable. I don't think that has any effect at all on the mortgage process.
Current scores EX: 678 (lender pull), MyFICO TU: 696 & EQ: 664
Message 3 of 6
jzsnow
Frequent Contributor

Re: AGI for mortgage?

We have both. Normal w-2 employee and run a small business on the side. We only make maybe 1-2k a year on the business. It's just for a little extra spending money and to keep the practice up. My husband tunes pianos.

I just wast sure how a lender would see our income.
Message 4 of 6
JM-AM
Valued Contributor

Re: AGI for mortgage?


@Vwaller72 wrote:
I'm no expert but I don't think there's any case where they use your AGI. That's something that really only matters for tax purposes as AGI is the portion of your income that is actually taxable. I don't think that has any effect at all on the mortgage process.

Technically they do not.

 

But be self employed, and take advantage of all the tax advantages and show a small income, and see how the UW looks at it then. You ultimately should still be approved, but approval amount will be a factor.

Good Luck
May all your dreams and wishes become a reality!
Message 5 of 6
Vwaller72
Valued Member

Re: AGI for mortgage?

Ahhhh... I see what you mean AGI is a bigger deal for self employed where the difference between gross income and AGI can be really big. Typically the difference for W2 employees isn't that vast. Learn something every day hanging around here.
Current scores EX: 678 (lender pull), MyFICO TU: 696 & EQ: 664
Message 6 of 6
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