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Hi! My husband and I were preapproved about a month ago & are now under contract on a new construction house. When I first started 'shopping' for our preapproval, I had three different lenders tell me that we would not get approved because of my husbands commission income. He has been with his company for about 18 months now, but he started with being paid hourly and was just promoted about 4 months ago and now receives base + commission. His commission is much more than his base , so we would not qualify for much on his base alone. Well, I was referred to another loan officer who told me his short commission history would be no problem and got us preapproved by getting a Verification of Employment for my husband's boss stating that his commission is guaranteed. & the amount he is guaranteed to receive each week. My LO assured me that he has gotten loans approved this way before, but I have googled until I am blue in the face and have not found one other person with this situation. Any info anyone can offer would be great! We are going USDA Guaranteed. My husband will make about 60k/year and I also run a little small business where I net about $2500/yr. Our mid credit scores are 728 & 734 with no negative marks , no collections , etc. & the purchase price of our house is $180k. We have one car note that is $380/month and we have about $100 in minimum credit card payments each month. Thank you for any help!
How is his company going to write a letter that says he has a "guaranteed" commission? Commission is based on performance/sales or else it would be his base salary. I don't see this happening.
However, if you mean "new construction" as in it's going to take several months to build the house to where there would be at least 12 months of commission history, that might be a different story... but based on history with my own clients, I don't see it working...
He is a truck driver and doesn't have to push sales. He has scheduled routes and just restocks the food. The stores don't just stop selling food, so his commission never really fluctuates more than a couple dollars per week. Of course, his company also has years worth of sales records for the same stores run by other drivers. They aren't actually selling anything .. the stores do the selling. They just refill. I feel the same way you do though , so hesitant.
It is taking several months to be built .. but should be ready by mid-late November. So he still will have only been receiving commission for 8-9 months.
He is a truck driver and doesn't have to push sales. He has scheduled routes and just restocks the food. The stores don't just stop selling food, so his commission never really fluctuates more than a couple dollars per week. Of course, his company also has years worth of sales records for the same stores run by other drivers. They aren't actually selling anything .. the stores do the selling. They just refill. I feel the same way you do though , so hesitant.
It is taking several months to be built .. but should be ready by mid-late November. So he still will have only been receiving commission for 8-9 months.
Won't be able to use commission without a 2 year history.
From an underwriter's POV...If it is 'guaranteed' why wouldn't they just make it base pay?
Because it is still based on sales. So that wouldn't work. I know what commission is, which is why I am having a hard time believing that this will work out, but I have stressed my concerns to my LO very clearly and he ensures me he's done them this way before. So I guess I am just clinging to some hope here, lol.
I guess I'll know soon enough. :/
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