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I have a question

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I have a question

What do mortgage lenders use as your income --- What your gross income on your income tax return, or your adjusted gross income? I was just wondering because my income before the adjustment is $130,000. Afterwards, it is around $117,000. 

Again thanks to all who take the time to respond.

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Message 1 of 7
6 REPLIES 6
Community Leader
Senior Contributor

Re: I have a question


@Cjaysmom wrote:

What do mortgage lenders use as your income --- What your gross income on your income tax return, or your adjusted gross income? I was just wondering because my income before the adjustment is $130,000. Afterwards, it is around $117,000. 

Again thanks to all who take the time to respond.


They use your AGI 

EXP 753 TU 781 EQ 733
Message 2 of 7
Contributor

Re: I have a question


@Jnbmom wrote:

@Cjaysmom wrote:

What do mortgage lenders use as your income --- What your gross income on your income tax return, or your adjusted gross income? I was just wondering because my income before the adjustment is $130,000. Afterwards, it is around $117,000. 

Again thanks to all who take the time to respond.


They use your AGI 


Thank you for your response.

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Message 3 of 7
New Contributor

Re: I have a question

I’ve don’t think they look at adjusted gross unless you are writing off certain things. They use w2 income but also ask for tax returns to make sure you aren’t adjusting.
Message 4 of 7
Moderator Emeritus

Re: I have a question


@Muffinman83 wrote:
I’ve don’t think they look at adjusted gross unless you are writing off certain things. They use w2 income but also ask for tax returns to make sure you aren’t adjusting.

W2 gross income as I understand it: namely one can always reduce 401k distributions which is basically the difference typically between the two lines for most people... deductions typically fall out after that.

 

When it comes to self-employed then yeah, it's net income and that's where people typically run into problem deducting too much (from a mortgage DTI perspective anyway).

 




        
Message 5 of 7
Contributor

Re: I have a question

On my W2, there is the medicare eages and then there is the wages, tips, other.  The medicare wages is $130,000. The wages, tips is $117,000. I am not self employed and have been employed at the same job for 27 years.

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Message 6 of 7
Contributor

Re: I have a question

And the difference between the two amounts is money taken out for retirement fund.

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Message 7 of 7
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