July 23, 2014
A reader asks, “My spouse is waiting an immigration process. Is there any way we can count all or partial income? My credit is at $800 and we have no other debts.”
This is a difficult question to answer without knowing more. The big question is whether the spouse income is verifiable or not–FHA loan rules require all income to be used in the debt to income ratio calculation (which is an important part of the loan approval process) to be verifiable.
What does this mean?
Verifiable income is defined as earnings that are stable, reliable, and likely to continue. Verifiable income is not always “taxable income”–veteran benefits, for example, may be counted as income even though they are tax-exempt. But some types of income can’t be used.
Non-verifiable income would include many types of earnings that may fit some of the three requirements, but not all three. Stable, reliable, and likely to continue wouldn’t apply to things like selling goods on eBay, for example, though this may be handled on a case-by-case basis depending on the nature of that income. Determining what income is verifiable and what is not is the responsibility of the loan officer, so we couldn’t comment on a certain type of income except in a general way, or in cases where FHA loans specifically address it, such as commissions or bonuses.
The fact that the reader’s potential co-borrower or c0-applicant is in an immigration process does not necessarily affect the loan application. Lawful resident aliens, non-resident aliens and others with legal status may apply for an FHA mortgage, though some additional documentation may be required. Potential FHA borrowers who legally reside in the United States should not feel their status will count against them at application time. FHA loan rules have been designed to help such applicants as well as U.S. citizens.
Borrowers who find themselves in the circumstances mentioned in the reader question should discuss their needs with a loan officer or contact the FHA directly for advice and assistance.
Do you have questions about FHA home loans? Ask us in the comments section. You can get information about applying or getting pre-approved for an FHA loan at FHA.com, a private company and not a government website.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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