Route 01
Paystubs and W-2s
The straight strand. Salaried and hourly income, evidenced by paystubs, W-2s and a verbal verification of employment.
Who this is
- You are employed and paid a salary or an hourly wage
- Your bonus or overtime has a two-year history you can show
- You have a second job you want counted
What you hand over
- Most recent 30 days of paystubs
- W-2s for the last two years
- Verbal verification of employment, taken shortly before closing
- A written offer letter if you have started a new role
How the figure is worked out
Base pay is taken at face value. Variable pay — bonus, overtime, commission under 25% of total compensation — is averaged over 24 months and will not be counted if the trend is down. A raise is used from the date it takes effect, not from the date it was promised.
Do the arithmeticWhat trips this route up
- A gap of 30 days or more in the last two years needs a written explanation.
- Income from a job you have held for under six months is usually averaged, not annualised.
- Unreimbursed business expenses on a Schedule A can reduce the figure that is used.
Where it leads
Programmes this route commonly unlocks
Demonstration form
Tell us about your paystubs
Nothing on this form is sent anywhere. On a working site it would reach a loan officer with the route you arrived through already attached.
The other four
Most files use more than one
- Bank statementsTwelve or twenty-four months of deposits, with an expense factor applied. Built for owners whose tax return is written to minimise tax, not to qualify for a loan.
- Profit and lossA CPA-prepared profit-and-loss statement, sometimes with 1099s alongside it. The shortest route when your accountant already has the numbers.
- AssetsNo income used at all. A verified pool of liquid assets is divided across the term to produce a qualifying figure. Common for retirees and for people between ventures.
- Rental incomeThe property qualifies, not you. Market rent is compared with the full housing payment to produce a debt-service coverage ratio.