Genworth Mortgage Insurance Corporation copy2018 Genworth Financial Inc All rights reserved
Calculating Income
Presented by Genworth Mortgage InsuranceDecember 2018
AgendaWhat we will coverrlm
ndash General Income Requirementsndash Documentation Requirementsndash Fannie Maendash Freddie Macndash Practice Casesndash Genworth Websitendash Helpful tools
2Calculating Income
We Are Covering Conventional Loans Only In Todayrsquos Session
Letrsquos Take A Quiz True or False W-2 wages are always considered salary income andrlmnever self-employed income for Fannie Mae or Freddie Mac
3Calculating Income
bullTrue or False All income types used for a mortgage for Fannie Mae or Freddie Mac must continue for at least three years
See Fannie Mae Seller Guide or Freddie Mac SellerServicer Guide for more information
Income RequirementsEstablish that income isrlm
ndash Steady Stable or increasingndash Likely to continue into the futurendash Must be able to document the income as per investor guidelines (Are they
reporting it on their tax returns)ndash Income from other Non-Employed Sources such as Child Support Interest
Income or Retirement income might be considered qualifying income but has different qualifying guidelines
ndash Policies change investors have overlays always verify requirements for uncommon or seldom used income types
4Calculating Income
Use Of Declining Income Is A Common Income Calculation Error
Income Document RequirementsDocumentation Requirementsrlm
ndash Manual Underwrite Typically requires two year history to be received and documented
ndash Automated underwriting (Loan Product Advisorreg or Desktop Underwriterreg)bull Typically follow the findings report or feedback certificatebull Often documentation is reduced from a manual underwrite
ndash Additional documentation is required to clarify a question inconsistency of an income source if using to qualify
ndash Conservative income calculations are preferred ndash When MI is needed always verify MI guideline requirements as well
5Calculating Income
Documentation Overlays May Exist Always Check Investor Credit Policy For Additional Requirements
ResourcesTo access the Fannie Mae Seller Guiderlm
ndash Go to httpwwwfanniemaecomndash Click on ldquoSingle Familyrdquo ldquoGuidesrdquo and then ldquoAllregsrdquondash Allregs covers both manual and DU underwriting requirementsndash Chapter B3-3 Income Assessment of the Seller Guide discusses Income
Underwriting requirements
6Calculating Income
bullTo access the Freddie Mac Loan Product Advisor Documentation Matrix and The Freddie Mac SellerServicer Guide
ndash Go to httpwwwfreddiemaccomndash Click on ldquoSingle Familyrdquo ldquo and then ldquoAllregsrdquo which is Freddie Macrsquos
SellerServicer Guide orndash Click on ldquoLearning Centerrdquo then ldquoQuick Referencesrdquo for
ndash Loan Product Advisor Documentation Matrix (Updated September 2018)ndash Chapter 53011 of SellerServicer Guide for Stable monthly income and asset
qualification for Freddie Mac
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
AgendaWhat we will coverrlm
ndash General Income Requirementsndash Documentation Requirementsndash Fannie Maendash Freddie Macndash Practice Casesndash Genworth Websitendash Helpful tools
2Calculating Income
We Are Covering Conventional Loans Only In Todayrsquos Session
Letrsquos Take A Quiz True or False W-2 wages are always considered salary income andrlmnever self-employed income for Fannie Mae or Freddie Mac
3Calculating Income
bullTrue or False All income types used for a mortgage for Fannie Mae or Freddie Mac must continue for at least three years
See Fannie Mae Seller Guide or Freddie Mac SellerServicer Guide for more information
Income RequirementsEstablish that income isrlm
ndash Steady Stable or increasingndash Likely to continue into the futurendash Must be able to document the income as per investor guidelines (Are they
reporting it on their tax returns)ndash Income from other Non-Employed Sources such as Child Support Interest
Income or Retirement income might be considered qualifying income but has different qualifying guidelines
ndash Policies change investors have overlays always verify requirements for uncommon or seldom used income types
4Calculating Income
Use Of Declining Income Is A Common Income Calculation Error
Income Document RequirementsDocumentation Requirementsrlm
ndash Manual Underwrite Typically requires two year history to be received and documented
ndash Automated underwriting (Loan Product Advisorreg or Desktop Underwriterreg)bull Typically follow the findings report or feedback certificatebull Often documentation is reduced from a manual underwrite
ndash Additional documentation is required to clarify a question inconsistency of an income source if using to qualify
ndash Conservative income calculations are preferred ndash When MI is needed always verify MI guideline requirements as well
5Calculating Income
Documentation Overlays May Exist Always Check Investor Credit Policy For Additional Requirements
ResourcesTo access the Fannie Mae Seller Guiderlm
ndash Go to httpwwwfanniemaecomndash Click on ldquoSingle Familyrdquo ldquoGuidesrdquo and then ldquoAllregsrdquondash Allregs covers both manual and DU underwriting requirementsndash Chapter B3-3 Income Assessment of the Seller Guide discusses Income
Underwriting requirements
6Calculating Income
bullTo access the Freddie Mac Loan Product Advisor Documentation Matrix and The Freddie Mac SellerServicer Guide
ndash Go to httpwwwfreddiemaccomndash Click on ldquoSingle Familyrdquo ldquo and then ldquoAllregsrdquo which is Freddie Macrsquos
SellerServicer Guide orndash Click on ldquoLearning Centerrdquo then ldquoQuick Referencesrdquo for
ndash Loan Product Advisor Documentation Matrix (Updated September 2018)ndash Chapter 53011 of SellerServicer Guide for Stable monthly income and asset
qualification for Freddie Mac
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Letrsquos Take A Quiz True or False W-2 wages are always considered salary income andrlmnever self-employed income for Fannie Mae or Freddie Mac
3Calculating Income
bullTrue or False All income types used for a mortgage for Fannie Mae or Freddie Mac must continue for at least three years
See Fannie Mae Seller Guide or Freddie Mac SellerServicer Guide for more information
Income RequirementsEstablish that income isrlm
ndash Steady Stable or increasingndash Likely to continue into the futurendash Must be able to document the income as per investor guidelines (Are they
reporting it on their tax returns)ndash Income from other Non-Employed Sources such as Child Support Interest
Income or Retirement income might be considered qualifying income but has different qualifying guidelines
ndash Policies change investors have overlays always verify requirements for uncommon or seldom used income types
4Calculating Income
Use Of Declining Income Is A Common Income Calculation Error
Income Document RequirementsDocumentation Requirementsrlm
ndash Manual Underwrite Typically requires two year history to be received and documented
ndash Automated underwriting (Loan Product Advisorreg or Desktop Underwriterreg)bull Typically follow the findings report or feedback certificatebull Often documentation is reduced from a manual underwrite
ndash Additional documentation is required to clarify a question inconsistency of an income source if using to qualify
ndash Conservative income calculations are preferred ndash When MI is needed always verify MI guideline requirements as well
5Calculating Income
Documentation Overlays May Exist Always Check Investor Credit Policy For Additional Requirements
ResourcesTo access the Fannie Mae Seller Guiderlm
ndash Go to httpwwwfanniemaecomndash Click on ldquoSingle Familyrdquo ldquoGuidesrdquo and then ldquoAllregsrdquondash Allregs covers both manual and DU underwriting requirementsndash Chapter B3-3 Income Assessment of the Seller Guide discusses Income
Underwriting requirements
6Calculating Income
bullTo access the Freddie Mac Loan Product Advisor Documentation Matrix and The Freddie Mac SellerServicer Guide
ndash Go to httpwwwfreddiemaccomndash Click on ldquoSingle Familyrdquo ldquo and then ldquoAllregsrdquo which is Freddie Macrsquos
SellerServicer Guide orndash Click on ldquoLearning Centerrdquo then ldquoQuick Referencesrdquo for
ndash Loan Product Advisor Documentation Matrix (Updated September 2018)ndash Chapter 53011 of SellerServicer Guide for Stable monthly income and asset
qualification for Freddie Mac
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Income RequirementsEstablish that income isrlm
ndash Steady Stable or increasingndash Likely to continue into the futurendash Must be able to document the income as per investor guidelines (Are they
reporting it on their tax returns)ndash Income from other Non-Employed Sources such as Child Support Interest
Income or Retirement income might be considered qualifying income but has different qualifying guidelines
ndash Policies change investors have overlays always verify requirements for uncommon or seldom used income types
4Calculating Income
Use Of Declining Income Is A Common Income Calculation Error
Income Document RequirementsDocumentation Requirementsrlm
ndash Manual Underwrite Typically requires two year history to be received and documented
ndash Automated underwriting (Loan Product Advisorreg or Desktop Underwriterreg)bull Typically follow the findings report or feedback certificatebull Often documentation is reduced from a manual underwrite
ndash Additional documentation is required to clarify a question inconsistency of an income source if using to qualify
ndash Conservative income calculations are preferred ndash When MI is needed always verify MI guideline requirements as well
5Calculating Income
Documentation Overlays May Exist Always Check Investor Credit Policy For Additional Requirements
ResourcesTo access the Fannie Mae Seller Guiderlm
ndash Go to httpwwwfanniemaecomndash Click on ldquoSingle Familyrdquo ldquoGuidesrdquo and then ldquoAllregsrdquondash Allregs covers both manual and DU underwriting requirementsndash Chapter B3-3 Income Assessment of the Seller Guide discusses Income
Underwriting requirements
6Calculating Income
bullTo access the Freddie Mac Loan Product Advisor Documentation Matrix and The Freddie Mac SellerServicer Guide
ndash Go to httpwwwfreddiemaccomndash Click on ldquoSingle Familyrdquo ldquo and then ldquoAllregsrdquo which is Freddie Macrsquos
SellerServicer Guide orndash Click on ldquoLearning Centerrdquo then ldquoQuick Referencesrdquo for
ndash Loan Product Advisor Documentation Matrix (Updated September 2018)ndash Chapter 53011 of SellerServicer Guide for Stable monthly income and asset
qualification for Freddie Mac
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Income Document RequirementsDocumentation Requirementsrlm
ndash Manual Underwrite Typically requires two year history to be received and documented
ndash Automated underwriting (Loan Product Advisorreg or Desktop Underwriterreg)bull Typically follow the findings report or feedback certificatebull Often documentation is reduced from a manual underwrite
ndash Additional documentation is required to clarify a question inconsistency of an income source if using to qualify
ndash Conservative income calculations are preferred ndash When MI is needed always verify MI guideline requirements as well
5Calculating Income
Documentation Overlays May Exist Always Check Investor Credit Policy For Additional Requirements
ResourcesTo access the Fannie Mae Seller Guiderlm
ndash Go to httpwwwfanniemaecomndash Click on ldquoSingle Familyrdquo ldquoGuidesrdquo and then ldquoAllregsrdquondash Allregs covers both manual and DU underwriting requirementsndash Chapter B3-3 Income Assessment of the Seller Guide discusses Income
Underwriting requirements
6Calculating Income
bullTo access the Freddie Mac Loan Product Advisor Documentation Matrix and The Freddie Mac SellerServicer Guide
ndash Go to httpwwwfreddiemaccomndash Click on ldquoSingle Familyrdquo ldquo and then ldquoAllregsrdquo which is Freddie Macrsquos
SellerServicer Guide orndash Click on ldquoLearning Centerrdquo then ldquoQuick Referencesrdquo for
ndash Loan Product Advisor Documentation Matrix (Updated September 2018)ndash Chapter 53011 of SellerServicer Guide for Stable monthly income and asset
qualification for Freddie Mac
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
ResourcesTo access the Fannie Mae Seller Guiderlm
ndash Go to httpwwwfanniemaecomndash Click on ldquoSingle Familyrdquo ldquoGuidesrdquo and then ldquoAllregsrdquondash Allregs covers both manual and DU underwriting requirementsndash Chapter B3-3 Income Assessment of the Seller Guide discusses Income
Underwriting requirements
6Calculating Income
bullTo access the Freddie Mac Loan Product Advisor Documentation Matrix and The Freddie Mac SellerServicer Guide
ndash Go to httpwwwfreddiemaccomndash Click on ldquoSingle Familyrdquo ldquo and then ldquoAllregsrdquo which is Freddie Macrsquos
SellerServicer Guide orndash Click on ldquoLearning Centerrdquo then ldquoQuick Referencesrdquo for
ndash Loan Product Advisor Documentation Matrix (Updated September 2018)ndash Chapter 53011 of SellerServicer Guide for Stable monthly income and asset
qualification for Freddie Mac
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Documenting Employment and Income
7Calculating Income
Two Year History is Required on the 1003 for all applicants
For Freddie Mac Gaps Greater Than 30 Days Should Be Addressed By The Applicant
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Documenting Employment and Income
8Calculating Income
Break Out Income Type For Proper AUS Results
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
IRS Form 4506-t
9Calculating Income
wwwirsgov
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
IRS Form 4506-t
10
wwwirsgov
Calculating Income
rlm The IRS Form 4506-Tndash IRS document used to retrieve past federal tax return transcripts 1065 1120S
1120 or W-2 and 1099 transcripts that are on file with the IRSndash Gives permission for a third party to retrieve the tax payerrsquos datandash Each applicant must sign a separate form regardless of the income source ndash The form is valid for 120 days once signedndash If the form is executed prior to closing it must be used to validate the income
documentation provided by the borrower and used in the underwriting processrlm When Completing A Blank 4506-t Form Lenders Must
ndash Fill in the recipient of the tax documents ndash either its name or the name of the servicer if servicing will be transferred within 120 days of the taxpayer signing the form
ndash Indicate that the request is for documentation concerning the year or years for which the borrowerrsquos income was or will be used in underwriting the loan
ndash Date the form with the date on which the borrower signs the form (or ascertain that date the borrower signed)
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Guidelines rlm 4506-t Must Be signed Once During The Application Process
ndash The timing is at the lenderrsquos discretion but it must be signed on or before the closing of the mortgage loan
ndash The Lender must document the requirement to obtain an executed IRS Form 4506-T with the IRS in their written quality control (QC) plan
ndash The borrower may need to complete multiple forms for different types of returns
Calculating Income 11
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Macrsquos Documentation Matrix
Calculating Income 12
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
13
Fannie MaeUpdates Policies and Fannie Maersquos Form 1084rlm
Calculating Income
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Selling Guide Self-Employment
14Calculating Income
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Updates 2018-09rlm Updates to self employed
policy
15Calculating Income
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Selling Guide
16Calculating Income
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Selling Guide
17Calculating Income
See B3-31-01 General Income Information (12042018)
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Selling Guide rlm Trends of Income
ndash Verify trends of income before using to qualify for a mortgagendash Income used must be likely to continue
18Calculating Income
See B3-31-01 General Income Information (12042018)
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Commission Income and 2106 Expensesrlm Updated Policy For Commission Income amp 2106 Expenses
ndash No longer required to obtain tax returns for commission incomendash Automobile allowance change
19Calculating Income
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
20
See B3-31-04 Commission Income Requirements (12042018)
Calculating Income
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
21Calculating Income
Documentation Fannie Mae Selling Guide
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
22Calculating Income
See B3-31-03 Base Pay (Salary or Hourly) Bonus and Overtime Income (05152012)
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Highlightsrlmndash Core principles of prudent underwriting must be followed when considering
income for qualifying purposesbull Source amount history of receipt and likelihood of continued receipt
ndash Income that does not have a defined expiration date (long term disability interest and dividend income and social security retirement income) no longer requires documentation of three-year continuance
ndash Income that DOES have an expiration date lenders must document a three-year continuance (see Fannie Mae Seller Guide)
23Calculating Income
Fannie Mae Selling Guide
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Selling GuideContinuance of Incomerlm
24Calculating Income
See B3-31-01 General Income Information (12042018)
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
25Calculating Income
Documentation Fannie Mae Selling Guide
Verbal Verificationsrlmndash Verbal verifications of employment for employed borrowers are required to be
completed within 10 business days of closing or if lenders choose a VVOE can be completed prior to loan delivery
ndash Verbal verifications of employment for self employed borrowers can now be completed within 120 days of note date or prior to loan delivery (Check for investor overlays)
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
26Calculating Income
Fannie Mae ldquoOptionalrdquo VOE fields
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
27Calculating Income
Fannie Mae Selling Guide
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Job AidsFAQs
28Calculating Income
httpswwwfanniemaecomsinglefamilyoriginating-underwriting-training
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Underwriting FAQsrlm Answers Common Lender Income
Questionsndash httpswwwfanniemaecomsinglefamilyorigin
ating-underwriting-training
29Calculating Income
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Fannie Mae Underwriting FAQsrlm Answers Common Lender
Income Questionsndash httpswwwfanniemaecomsinglefamily
originating-underwriting-training
30Calculating Income
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
31
Freddie Mac Bulletins Documentation and Rental Income Matrix and Freddie MacrlmForm 91
Calculating Income
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Bulletin 2016-19-Income Changes
32Calculating Income
Effective Loans With Settlement Dates On Or After July 6 2017
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Bulletin 2018-08
33Calculating Income
rlm Income Reminders
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
General Requirements For Freddie Mac
34Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac SellerServicer Guide
35Calculating Income
Chapter 53011 General requirements for all stable monthly income
Income Continuance Charts Added To The Freddie Mac SellerServicer Guide
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Income Continuance Requirements
36Calculating Income
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Primary Base and Secondary Employment
37Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Primary Base and Secondary Employment
38Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Primary Base and Secondary Employment
39Calculating Income
Updated Freddie Mac Income Guidelines Everything In Green Is Updated Verbiage In The SellerServicer Guide
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Commission Income
40Calculating Income
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Documentation Matrixrlm Documentation Matrix
ndash Assists in underwriting and documenting loans for Freddie Mac
ndash Lenders may have overlays ndash Check specific program
requirementsndash Updated September 2018
41Calculating Income
httpfreddiemaccomlearn
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
42Calculating Income
Freddie Mac Monthly Income
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
43Calculating Income
Income Documentation Requirements
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
44Calculating Income
Freddie Mac Income Documentation
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Form 91 Freddie Mac Income Calculation Form 91 Updated August 2017rlm
ndash Sellers are required to analyze self employed borrowers using Freddie Mac Form 91 or a similar form
bull Updates include removal of Rental income 2106 expenses 4797 and 6252 ndash The form should be maintained in the loan filendash Form can be used for ldquoother types of non-self employed income such as
commissioned income and capital gain incomendash Borrowers that have 25 or more ownership in a business are considered self
employed for Freddie Mac qualifying purposesndash Tax returns may be required for additional scenarios such as
bull Applicants working for family membersbull Working for the property sellerbull Commission income of 25 or morebull Rental or Farm Income
45Calculating Income
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
46Calculating Income
Freddie Mac Self-Employed Documentation
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
47Calculating Income
Freddie Mac Self-Employed Documentation
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Updates For Freddie Mac 2017-12
48Calculating Income
rlm Effective for loans with settlement dates on or after February 9 2018 Sellers may implement immediately
ndash Short-term and long-term rental income sources for refinance transactions
ndash Updates policy for rental properties NOT owned in the prior calendar year
ndash Reintroduces Guide Form 1000 and retires Operating Income Form 998
ndash Expanding requirements additional specificity and guidance for
bull Accessory unitsbull Leasesbull Net rental income calculationsbull Establishment of DTI ratiosbull Rental Income from form 8825
ndash New Rental Form 92ndash Revised Form 91 (Income Calculations)
March 1 2019
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
What Guidelines Do We Followrlm Sellers may originate underwrite
and deliver Mortgages based either on the rental income requirements
ndash In effect prior to Bulletin 2017-12 in their entirety
ndash The revised rental income requirements announced in Bulletin 2017-12 in their entirety (and for which the effective date was extended in Bulletins 2018-1 and 2018-13) or
ndash The revised rental income requirements in the March 1 2019 version of Guide Section 53061 in their entirety
Calculating Income 49
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
50Calculating Income
httpwwwfreddiemaccomsinglefamilyformssellpdf91pdf
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Form 92
51Calculating Income
Available Now
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Freddie Mac Form 92
Genworth MI Form 92 Rental Income Calculator newmigenworthcomself-employed-borrower-calculators
Calculating Income 52
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Updates For Freddie Mac 2017-20
53Calculating Income
rlm Effective Immediatelyndash Allowing use of Restricted Stock and
Restricted stock units in certain casesndash Expanding ldquoAssets as basis for Mortgage
Qualificationrdquobull Changing name to Assets as a basis for
repayment of obligationsbull Adding depository accounts and securities as
assets available to be used (not just retirement accounts)
ndash One borrower must be 62 years of agendash Borrower must be the sole owner of the asset (or if
jointly owned both must be on the mortgage transaction)
ndash No withdrawal penaltyndash Document source of funds for any deposit
exceeding 10 of the borrowerrsquos total eligible assets verify the deposit does not include gifts or borrowed funds or reduce assets used to qualify
See Freddie Mac SellerServicer Guide For Complete Details
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
54
Document Review Pay Stubs W-2s Written VOEsrlm
Calculating Income
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Income Conversion Exercises
55Calculating Income
Calculate the monthly income for each pay scenario above
$60000$750
$1000
$1250$20 hour 40 hours weekly
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
56Calculating Income
Remindersndash The borrowerrsquos name and SSN must be consistent with the application
(Spelling middle initial or a JR or III)ndash Computer generatedndash If paid hourly the number of hours must be noted on the paystubndash Dated within 30 days of application If stale dated ask applicant for more recent
stubndash YTD income must be provided and should be consistent with monthly incomendash Note any commission overtime or bonus income-donrsquot use if you donrsquot needndash Review for possible liabilities that may need to be included in your debt ratio
(child support or alimony or IRS garnishment or a new loan take out)ndash If automatically deposited cross reference the income to the bank statementndash We are calculating income but also validating the document does employer
match back to application To the W-2
Pay Stubs
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Paystub
57Calculating Income
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
58Calculating Income
W-2 Remindersrlmndash Name and SSN match application and also the pay stubndash Applicantrsquos address should also match the 1003 and bank statement mailing
addressndash Should be the most recent one or two (if required)ndash Is the ytd income consistent with monthly income if not obtain explanationndash Employer addresses match applicationndash Employer ID must be valid (XX-XXXXXX) is the proper formatndash FICA and Medicare withholding based on wages can be checkedndash You generally should NOT have the Employerrsquos Copy or the Social Security
Administration Copyndash Review the document at application donrsquot just shove in the loan filendash Obtain tax transcripts to support income if needed
Examining W-2s
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
59Calculating Income
Examining W-2-Any questions on this W-2
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
60Calculating Income
VOE Remindersrlmndash Independently verify address to which you are sendingndash Do not put ldquoAttention tordquo on the formndash Forms should be signed dated with signature and printed name of employerndash If faxed note the origin of the faxed document-Is it coming from the employerndash Income and work history job title consistent with applicationndash Is bonus or overtime likely to continue Probability of Continued Employmentndash Review for different handwriting styles cross outs white out or cutting and
pastingndash Should it be handwritten Large corporationsndash The VOE cannot be hand carried by the applicant NOR should it be mailed to a
PO Box unless you have verified that that is the employerrsquos protocolndash VOE can be helpful in breaking out income such as commission overtime or
bonusndash Verify document does not expire prior to note date (Typically documents are
valid for four months)
Written Verification of Employment
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
61Calculating Income
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
62
Exercises
Calculating Income
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Income Calculation Exercises
63Calculating Income
Keep in Mind
Sometimes there are several ways to calculate
income
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
64Calculating Income
Local Iron Workers Union W2rsquos from various jobsIncomerlm 15 rsquo16 `17
ndash W2 $52399 $61555Y-T-D paystubrlm As of 09-30-17 $59765John is unemployed seasonally
Calculation W2rsquos amp Paystub and 1099
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
65Calculating Income
Calculation from W2rsquos amp Paystub
-- Sally works as a school nurse and works from Sept 1st- June 30th earning $802 every two weeks
-- She also receives child support for $500 per month that will continue for 10 years
rsquo16 rsquo17 rsquo18
W-2 $28897 $30250 See pay stub
YTD pay stub as of 121518 - $33925
- Samrsquos current salary is $35400
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
What is the qualifying monthly income
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
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Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
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Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
66Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Paystub
67Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Pay Stub with Prior Year W-2
Calculating Income 68
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
Reviewing Paystubs
2016 64528 12 = $ 5377 YTD $8562 4 months = $2140
Base pay $2854 x 24 = $68496 divided by 12 = $5708
Calculating Income 69
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
70Calculating Income
rlm Eli receives $4080 in taxable social security income as per his most recent tax returns His application states he is 42 years old with no dependents
rlm Calculate the monthly social security income ONLY for Eli Do you have to do anything special
0
Calculation from Tax Returns
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
71Calculating Income
Gross Monthly Income
BorrowerBase IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOther $415Sub TotalNet Rental Subject Net CashTotal $415
$4800 - $4080 = $720 x 25 (gross up only the non taxable portion which is $720) $4800 + $180 (which is 720 x 25) $4980 and $498012 = $415 Note Freddie Mac is requiring proof income is non-taxable for you to gross up
Calculation from Tax Returns
Due to his age you must also verify it will continue for at least three more years Be aware Freddie Mac requires
you confirm with tax returns or similar to confirm income is
non-taxable
bull Eli receives $4800 in social security income as per his most recent tax returns His application states he is 42 years old with no dependents
bull Calculate the monthly social security income ONLY for Eli Do you have to do anything special
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
72Calculating Income
Base IncomeSelf EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
Y-T-D-2018 through 63018rlmndash Assume it is currently 63018Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
Calculation from VOE
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
Gross Monthly Income | Gross Monthly Income | |||||||||
Borrower | Lucy J | |||||||||
Base Income | Base Income | |||||||||
Self Employed | Self Employed | |||||||||
Overtime | Overtime | |||||||||
Bonuses | Bonuses | |||||||||
Commissions | Commissions | |||||||||
DividendsInterest | DividendsInterest | |||||||||
Other | Other | |||||||||
Sub Total | Sub Total | |||||||||
Net Rental | Net Rental | |||||||||
Subject Net Cash | Subject Net Cash | |||||||||
Total | Total |
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Yor N | ||||||
Account Type | Resubordinated | |||||
Balance | Omited | |||||
Payment | Paid by Close | |||||
Total Monthy Payments |
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
(use PampI factor card) | First Mortgage (PampI) | Total Income | ||||||||||
Other Financing (PampI) | ||||||||||||
($325 per $1000 mtg amt if applic) | Hazard Insurance | Total Housing Debt | Housing Ratio (FrontFirst) | |||||||||
Real Estate Taxes | Total Personal Debt | |||||||||||
(see GE rate card if applic) | GE Mortgage Insurance | Total Debt | Total Debt Ratio (TDISecond Back) | |||||||||
HOA Dues | ||||||||||||
Other | ||||||||||||
Other | ||||||||||||
TOTAL | ||||||||||||
Other Income | $ | |||||||||||
Alimony Child Support | ||||||||||||
Auto Expense | ||||||||||||
Foster Care | ||||||||||||
Military | ||||||||||||
Notes Receivable | ||||||||||||
Other | ||||||||||||
PensionRetirement | ||||||||||||
Real Estate Differential | ||||||||||||
Social SecurityDisability | ||||||||||||
Trust Income | ||||||||||||
UnemploymentWelfare | ||||||||||||
VA Benefits |
73Calculating Income
Base Income $208300Self EmployedOvertimeBonusesCommissionsDividendsInterestOtherSub TotalNet Rental Subject Net CashTotal
Incomerlm lsquo16 lsquo17 rsquo18ytd ndash Base $50000 $53000 $12500ndash Commission $0 $0 $35000
-Y-T-Drlm through 63018ndash Assume it is currently 63018
Donovanrsquos pay structure changed 1118 to base plus commission-New Annual Salary is $25000
What is the qualifying monthly income
$2500012 =$2083
Always Check Investor Guidelines Most Typically Require A Two Year History Of Receipt Before You Can Use As Qualifying Income
Calculation from VOE
Only base pay can be used
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
httpfanniemaecomportalindexhtml
Fannie Mae Website
74Calculating Income
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Fannie Mae Selling Guide
Calculating Income 75
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Freddie Mac SellerServicer Guide
76Calculating Income
httpwwwfreddiemaccomsinglefamily
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Freddie Mac Documentation Matrix
77Calculating Income
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
78Calculating Income
Freddie Mac Documentation Matrix
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Calculating Income 79
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Genworth Underwriting Guidelines
80Calculating Income
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Genworth Rate Expressreg
Calculating Income 81
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
LOS Connections
Calculating Income 82
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Calculating Income 83
Training Tools and Information
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Training Tools and Information
Calculating Income 8484
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
Additional MI Site Information
Calculating Income 85
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
86Calculating Income
ActionCenterreg 800 4445664 Your Local Genworth
Regional Underwriter Your Genworth Sales
Representative
Your Genworth Resources
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance
87Calculating Income
Legal Disclaimer Genworth Mortgage Insurance is happy to provide you with these training materials While we strive forrlmaccuracy we also know that any discussion of laws and their application to particular facts is subject to individual interpretation change and other uncertainties Our training is not intended as legal advice and is not a substitute for advice of counsel You should always check with your own legal advisors for interpretations of legal and compliance principles applicable to your business
GENWORTH EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES EXPRESS OR IMPLIEDrlmINCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT TO THESE MATERIALS AND THE RELATED TRAINING IN NO EVENT SHALL GENWORTH BE LIABLE FOR ANY DIRECT INDIRECT INCIDENTAL PUNITIVE OR CONSEQUENTIAL DAMAGES OF ANY KIND WHATSOEVER WITH RESPECT TO THE TRAINING AND THE MATERIALS
Genworth Mortgage Insurance Offers A Comprehensive Suite Of Training Opportunities To Boost Your Know-How Benefit Your Bottom Line And Serve Your
Borrowers Better Visit migenworthcom To Learn More
Collateral Underwriterreg Home Ready reg and Desktop Underwriterreg or DUreg are registered trademarks of Fannie MaeLoan Product Advisorreg Home Possiblereg Loan Collateral Advisorreg and Home Value Explorerreg (HVEreg) are registered trademarks of Freddie MacActionCenterreg Homebuyer Privilegesreg and Rate Expressreg are registered trademarks of Genworth Mortgage InsuranceSimply UnderwriteSM is a registered service mark of Genworth Mortgage Insurance