Income Underwriter - Professional Income Analysis Tools for Mortgage Professionals

Income Underwriter is a professional income analysis application designed for mortgage underwriters, loan officers, and financial professionals. Our AI-powered tools help analyze variable, hourly, overtime, commission, and bonus income from paystubs with industry-standard calculation methods.

Our Income Calculation Tools

Fixed Income Calculator - Calculate monthly income from hourly, weekly, bi-weekly, semi-monthly, monthly, or annual pay rates using standard mortgage industry formulas.
Variable/Hourly Income Averager - Upload year-end paystubs and automatically extract income data using AI-powered OCR technology. Categorize pay types and view income trends across multiple fiscal years.

Key Features

AI-powered OCR for automatic paystub data extraction
Income categorization (Base/Regular, Overtime, Commission, Bonus)
Multi-year trend analysis and worst-case averaging
Employer tracking and management
PDF export for documentation
Privacy-focused with automatic data cleanup

Understanding Income Underwriting

Income underwriting is a critical process in mortgage lending where financial professionals analyze a borrower's income documentation to determine their ability to repay a loan. This process involves reviewing paystubs, W-2 forms, tax returns, and other financial documents to calculate a stable, recurring monthly income figure that can be used for loan qualification.

Fixed Income Calculation Methods

Converting different pay frequencies to monthly income requires specific mathematical formulas based on the payment schedule:

Hourly Pay: Monthly = (Hourly Rate x Hours/Week x 52) / 12
Weekly Pay: Monthly = (Weekly Pay x 52) / 12
Bi-Weekly Pay: Monthly = (Bi-Weekly Pay x 26) / 12
Semi-Monthly Pay: Monthly = Semi-Monthly Pay x 2

Variable Income Categories

Variable income refers to earnings that fluctuate from pay period to pay period. Mortgage underwriters must carefully analyze this income over time to establish a reliable monthly average. Different types of variable income include:

Base/Regular Pay: The primary, stable portion of an employee's compensation.
Overtime Income: Hours worked beyond the standard 40-hour workweek, typically paid at 1.5x the regular rate.
Commission Income: Earnings based on sales performance or revenue generation.
Bonus Income: Periodic additional compensation such as performance bonuses or profit-sharing.

Worst-Case Averaging Methodology

When calculating variable income for mortgage qualification, underwriters use a conservative "worst-case" approach to protect both the lender and the borrower. This methodology ensures that borrowers are not overextended based on income that may not be sustainable. The worst-case average is determined by comparing multiple calculation methods and using the lowest result.

Income Documentation Requirements

Proper documentation is essential for income verification in mortgage underwriting. Standard W-2 employees typically need the most recent 30 days of paystubs, W-2 forms for the past 2 years, and verification of employment. Variable income employees may need 24 months of paystubs, W-2 forms, and tax returns.

Industry Guidelines

The mortgage industry follows established guidelines from Fannie Mae, Freddie Mac, FHA, VA, and USDA loan programs. These guidelines provide standardized methods for calculating different types of income to ensure consistent and fair lending practices.

Contact Us

Have questions about income underwriting or our tools? Visit our Contact page to reach us.