One of the many nice features of loans guaranteed by the Department of Veteran’s Affairs (VA) is that VA-approved lenders will generally consider your total financial picture when you’re trying to qualify for a loan, rather than simply following specific rules or a checklist. That means that people with military backgrounds who eligible for VA mortgages may be able to qualify using part-time income.

Be consistent

Consistency is the key to using part-time income (or overtime, commission, or self-employment income) to qualify for a VA mortgage. Your VA-approved lender will want to see that your income has been consistent and is likely to continue into the future.

Generally speaking, a two-year history is sufficient to prove your income is reliable. The lender will probably average your income when deciding whether or not you’ll qualify.

Ideally, your two-year history should be with a single employer, but some lenders may be willing to consider employment from several employers. If you don’t have a two-year history, you may be able to compensate for that by making a down payment, having a significant financial reserve, or demonstrating a low debt-to-income (DTI) ratio.

The consistency guideline means that borrowers who take a second part-time job, or volunteer for overtime, to qualify for a VA loan may be disappointed. Just picking up extra income for a few months won’t help qualify for a VA loan. Without history, your lender probably won’t consider that income when considering your loan application.

Shop around

It’s important to remember that policies and guidelines vary from lender to lender, so it’s worth your time to talk to more than one. At Embrace Home Loans, we’re experts in VA lending, and we can help you understand what your income requirements may be and how part-time income can help you qualify for a VA loan. Call us at 407-733-6425 for more information about part-time incomes and VA mortgages.

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