## Does Overtime Count Towards Mortgage?
Whether or not overtime counts towards mortgage is a common question for potential homebuyers and homeowners alike. The answer is often yes, but it depends on the lender and the type of overtime.
**What is Overtime?**
Overtime is any time worked beyond the standard 40 hours per week. In the United States, overtime is typically paid at a rate of 1.5 times the employee’s regular hourly wage.
**How Lenders View Overtime**
Lenders generally consider overtime income when evaluating a mortgage application. However, not all lenders view overtime the same way. Some lenders may consider all overtime income, while others may only consider overtime that is guaranteed or that has been received for a consistent period of time.
**Types of Overtime**
There are two main types of overtime:
* **Guaranteed overtime:** This is overtime that is required by the employer and is paid regardless of whether the employee actually works the extra hours.
* **Non-guaranteed overtime:** This is overtime that is not required by the employer and is only paid if the employee actually works the extra hours.
**How to Document Overtime Income**
When applying for a mortgage, you will need to provide documentation of your overtime income. This documentation can include:
* **Pay stubs:** Pay stubs that show overtime hours and pay
* **Tax returns:** Tax returns that show overtime income
* **Letters from your employer:** Letters from your employer that state your overtime hours and pay
**How to Increase Your Chances of Getting Approved for a Mortgage with Overtime Income**
If you are planning to use overtime income to qualify for a mortgage, there are a few things you can do to increase your chances of getting approved:
* **Make sure your overtime income is guaranteed.** Lenders are more likely to consider overtime income that is guaranteed than overtime income that is not.
* **Document your overtime income.** Be sure to provide your lender with all of the necessary documentation to support your overtime income.
* **Explain your overtime situation to your lender.** If you have any unusual circumstances that affect your overtime income, be sure to explain them to your lender.
**Conclusion**
While overtime income can be a helpful way to qualify for a mortgage, it is important to remember that not all overtime income is treated the same way by lenders. By following the tips above, you can increase your chances of getting approved for a mortgage with overtime income.
## Additional Information
In addition to the information above, here are some additional things to keep in mind about overtime income and mortgages:
* **Some lenders may have maximum limits on the amount of overtime income that they will consider.** Be sure to ask your lender about their specific policies.
* **Overtime income may not be considered if it is not expected to continue.** If you are only expecting to receive overtime income for a short period of time, it may not be worth including it in your mortgage application.
* **Overtime income can be used to qualify for a higher loan amount.** If you have a stable overtime income, you may be able to qualify for a higher loan amount than you would if you only had regular income.
If you have any questions about overtime income and mortgages, be sure to talk to your lender. They will be able to provide you with more specific information and help you determine if overtime income is right for you.
## FAQs
**Q: Does all overtime count towards a mortgage?**
A: No, not all overtime counts towards a mortgage. Some lenders may only consider overtime that is guaranteed or that has been received for a consistent period of time.
**Q: How can I document my overtime income?**
A: You can document your overtime income by providing your lender with pay stubs, tax returns, or letters from your employer.
**Q: What if my overtime income is not guaranteed?**
A: If your overtime income is not guaranteed, it may not be worth including it in your mortgage application. Lenders are more likely to consider overtime income that is guaranteed than overtime income that is not.
**Q: Can I use overtime income to qualify for a higher loan amount?**
A: Yes, you may be able to qualify for a higher loan amount if you have a stable overtime income.