A borrower's W-2 shows base salary of $50,000 plus $15,000 in overtime pay. The borrower has worked overtime consistently for 15 months. How should the overtime income be treated?
Correct Answer
C) Include overtime income with additional documentation of likelihood to continue
Overtime income with less than two years history can be included if the borrower provides documentation showing the likelihood of continued receipt, such as an employer letter or contract. The 15-month history shows consistency but requires additional verification.
Why This Is the Correct Answer
Overtime income with less than two years history can be included if the borrower provides documentation showing the likelihood of continued receipt, such as an employer letter or contract. The 15-month history shows consistency but requires additional verification.
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A lender's compensation structure pays MLOs higher commissions for non-QM loans than for conventional or government loans. An MLO can still comply with anti-steering rules by: