FHA – Declining Overtime Income Calculation: What are the rules for averaging overtime income if that income shows a decline from the previous year?

Answer: If the Overtime or Bonus Income from the current year decreases by 20 percent or more from the previous year, you must use the current year’s income. Reference: v. Overtime and Bonus Income (TOTAL) (A) Definition: Overtime and Bonus Income refers to income that the Borrower receives in addition to the Borrower’s normal salary. (B) Standard: The Mortgagee may [...]