How Much House Can You Afford? It All Comes Down To Your Income—Documented, Of Course!
Not all income is created equal! So, why can’t all your income be used to qualify? Let’s break it down.

Time to talk money! 💰 When you’re gearing up to qualify for a home loan, we’ve gotta figure out how much of your income we can actually count. If you’re a W-2 employee, we’ll look at your steady paycheck. If you’re the boss (self-employed or 1099), we’ll need a little extra proof of your hustle! 📄
Bottom line: we want to make sure you can comfortably repay your loan—and knowing how much cash you’re bringing in is the first step. So, grab those last 2 years of income docs, and let’s see what you can afford! 🏡💥
Income Calculation Tips To Keep In Mind:
- Income calculations are based on the most conservative approach. Compare your year-to-date earnings to your hourly rate and average hours worked per week.
- To use bonus, commission, and/or overtime income for qualifying, you will need to show a 12-24-month history of receipt.
- If you currently hold two jobs, you will need to have been employed with the second job for 2 or more years to use the income for qualifying.
- It is important to change jobs as little as possible when working toward qualifying for a home loan. It is best to speak with your licensed loan officer to review any employment changes you are looking to make before making them.
- If you are self-employed, your income will be calculated based on your tax returns for the most recent 2 years. Self-employed income calculations are best to review with your licensed loan officer.
We are here to help with calculating your income. Please collect the following documents and send them over to your Loan Officer. We will be able to confirm the exact amount of income to be used for qualifying for a new home:
- 2 years personal tax returns – all schedules
- 2 years W2s, 1099s, and K1s
- If more than 25% ownership of any entity – full 2 years of entity returns required with all schedules.
We look forward to hearing from you and helping you determine the income that can be used for your mortgage needs!
Have questions? Give us a call! One of our mortgage specialists would be happy to answer all of your questions about how to properly calculate your income but give the below worksheet a try!