How do you handle a borrower whose income is complicated?

Hi, this is Jason Skelton with Pacific National Lending.

Welcome to another Q&A session where I answer mortgage questions from you all on the internet.

Today's question is:

"How do you handle a borrower whose income is complicated?"

Summary:

Jason describes complex income files as the part of the job he enjoys most, identifying himself as a numbers person who likes working through the math to make a file come together. Being self-employed himself, he is comfortable analyzing tax returns and profit and loss statements. He confirms that income can be drawn from all sources and can be combined — citing Social Security alongside VA disability and self-employment income as an example. He also highlights a lesser-known option: a portion of a borrower's assets can be used to support qualifying income even when the borrower is not drawing from them. A significant sum held in a bank or investment account can be shown as emergency funds and used to offset income requirements.

Answer:

That to me is actually the fun part of my job. I'm a numbers guy. That's what I really enjoy — crunching numbers and figuring out how to make it work. I too am self-employed, so I'm very familiar with analyzing tax returns, profit and loss statements, things like that. But yes, we can use income from all sources. We can use Social Security in conjunction with VA disability and self-employment. We can even use a portion of your assets, even if you're not drawing from them, to help with the income. So if you have a large sum of money in the bank or in an investment and you're not wanting to draw from that, but we can show that you have that as emergency funds, we can use that to offset some of your income requirements for you. Complicated income isn't a problem — it just takes somebody willing to do the analysis.