How to Get a Mortgage in Kentucky with Variable Income

 

How to Get a Mortgage in Kentucky with Variable Income (FHA, VA, USDA & Fannie Mae Guide)

Are you a commission-based, gig economy, or hourly wage worker wondering if your fluctuating income can get you approved for a mortgage in Kentucky? The answer is YES—with the right documentation and strategy. Here’s what you need to know to get approved with variable income for FHA, VA, USDA, and Fannie Mae loans in 2025.

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📌 What is Variable Income?

Variable income includes pay that changes monthly—like bonuses, overtime, tips, commissions, or self-employed earnings. Mortgage lenders require a history of income and proof that it's likely to continue.

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🏠 FHA Mortgage Guidelines

FHA loan Kentucky | FHA variable income | Kentucky mortgage approval

• 2 years of variable income history
• Income consistency required
• Documentation: W-2s, pay stubs, full tax returns

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🇺🇸 VA Loan Guidelines

VA loan Kentucky | veteran mortgage KY | variable income VA loan

• 1-2 years of consistent income
• Must pass residual income test
• Docs: Tax returns, LES, employer verification

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🌾 USDA Loan Guidelines

USDA loan Kentucky | rural mortgage KY | USDA income rules

• 12-24 months income history
• Stability must be documented
• Docs: 2 years of tax returns, YTD paystubs, VOE

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🏡 Fannie Mae (Conventional Loan) Guidelines

Conventional mortgage KY | Fannie Mae variable income

• Minimum 12 months history (24 preferred)
• Trending analysis required
• Docs: Pay stubs, tax returns, income verification

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📄 Tips for Getting Approved with Variable Income

• File taxes on time
• Keep consistent, accurate income records
• Avoid long income gaps
• Request an income stability letter from your employer

Bonus: Include side income if documented.

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👨‍💼 Advice from Kentucky Mortgage Expert – Joel Lobb

“As a Kentucky mortgage broker, I’ve helped hundreds of buyers get approved using commissions, bonuses, and gig work. The key is documentation and program selection.”

📞 (502) 905-3708
📧 kentuckyloan@gmail.com
🌐 www.mylouisvillekentuckymortgage.com
NMLS #57916 | Equal Housing Lender

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📊 Infographics & Visuals

• FHA Income Approval Chart
• VA Residual Income Chart
• USDA Income Verification Infographic
• Fannie Mae Trending Income Graphic

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🎯 Call to Action: Ready to Get Pre-Approved?

Let Joel Lobb and his team help you qualify using your variable income.

• ✔️ Free Pre-Approval
• ✔️ Same-Day Responses
• ✔️ Zero-Down Loan Options

Contact Joel Today:
www.mylouisvillekentuckymortgage.com
NMLS #57916 | www.nmlsconsumeraccess.org

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Variable Income for A Mortgage Loan Approval in Kentucky

How to get approved for a Kentucky FHA, VA, USDA and Fannie Mae Mortgage loan with Variable Income 

 Variable INCOME if your borrower is not hourly at 40 hours a week or salary do you fall within VARIABLE INCOME?? Yup we all dislike that is calculated by an averaging method..

Examples of income of this type include income from hourly workers with fluctuating hours, or income that includes commissions, bonuses, or overtime.

History of Receipt: Two or more years of receipt of a particular type of variable income is recommended; however, variable income that has been received for 12 to 24 months may be considered as acceptable income, as long as the borrower’s loan application demonstrates that there are positive factors that reasonably offset the shorter income history.

Frequency of Payment: us as a lender must determine the frequency of the payment Examples:
If a borrower is paid an annual bonus on March 31st of each year, the amount of the March bonus should be divided by 12 to obtain an accurate calculation of the current monthly bonus amount.

Note that dividing the bonus received on March 31st by three months produces a much higher, INACCURATE monthly average.

If a borrower is paid overtime on a biweekly basis, the most recent paystub must be analyzed to determine that both the current overtime earnings for the period and the year-to-date overtime earnings are consistent and, if not, why.

There are legitimate reasons why these amounts may be inconsistent yet still eligible for use as qualifying income. For example, borrowers may have overtime income that is cyclical (transportation employees who operate snow plows in winter, package delivery service workers who work longer hours through the holidays).

We must investigate the difference between current period overtime and year-to-date earnings and document the analysis before using the income amount in the trending analysis.

Income Trending: After the monthly year-to-date income amount is calculated, it must be compared to prior years’ earnings using the borrower’s W-2’s or signed federal income tax returns (or a standard Verification of Employment completed by the employer or third-party employment verification vendor).

If the trend in the amount of income is stable or increasing, the income amount should be averaged.

 If the trend was declining, but has since stabilized and there is no reason to believe that the borrower will not continue to be employed at the current level, the current, lower amount of variable income must be used.

If the trend is declining, the income may not be stable.

Additional analysis must be conducted to determine if any variable income should be used, but in no instance may it be averaged over the period when the declination occurred.

Joel Lobb  Mortgage Loan Officer

American Mortgage Solutions, Inc.
10602 Timberwood Circle
Louisville, KY 40223
Company NMLS ID #1364

Text/call: 502-905-3708
fax: 502-327-9119
email: kentuckyloan@gmail.com

http://www.mylouisvillekentuckymortgage.com/

NMLS 57916  | Company NMLS #1364/MB73346135166/MBR1574
Get Approved Now Click Here

The view and opinions stated on this website belong solely to the authors, and are intended for informational purposes only. The posted information does not guarantee approval, nor does it comprise full underwriting guidelines. This does not represent being part of a government agency. The views expressed on this post are mine and do not necessarily reflect the view of my employer. Not all products or services mentioned on this site may fit all people.
NMLS ID# 57916, (www.nmlsconsumeraccess.org).