Bonus and Overtime with DU (Conventional)

Bonus and Overtime - DU will recommend one of the following
Verbal VOE
One Pay stub and telephone confirmation (or in lieu of telephone confirmation, an additional pay stub dated within 30 days of closing) or
One pay stub, telephone confirmation, and the previous year's W2
Income calculation:
When using a verbal VIE, the lender just determine that the stated bonus and overtime income used for qualifying purposes is reasonable based on the borrower's occupation, tenure and title.

When using a pay stub that reflects YTD bonus and overtime income, the bonus and overtime income must be annualized (divided by 12). If the lender choose to average the bonus and overtime over a longer period of time, additional documentation must be provided. It may also be necessary to obtain additional information or documentation from the borrower to establish the stability of the bonus and over time income.

It could sometimes be in the borrower's best interest to provide more documentation then what DU ask for. The required calculation including annualizeing the YTD from a pay stub will decrease the bonus/Overtime substantially if the borrower is in the first-mid late year.

Please, Please if you do get the verbal waiver DO NOT PROVIDE ANY INCOME DOCUMENTATION! The underwriter will make you meet the manual underwriting guidelines if you do.