Borrowers who apply for an FHA insured mortgage are required to submit application data including specific details about employment, income, and the sources of that income.
FHA income requirements aren’t limited to just dollar amounts and the history of the borrower’s employment–the sources and stability of the income listed on the application are also reviewed.
A borrower’s debt-to-income ratio, the amount of money going out versus the amount of money coming in, is calculated using only verifiable and reliable income. The FHA has rules about the nature of the income that can be used for this calculation; if a borrower has a job that isn’t “stable and reliable” when it comes to income, it won’t help the borrower for the purposes of qualifying for an FHA mortgage.
Specifically, the FHA rules as listed in HUD 4155.1 4.D.1.a state, “Income may not be used in calculating the borrower