How many months worth of check stubs?

Question

My income recently increased, and I only have 2 months worth of check stubs that reflect the new income. I have been working at the same place for 6 years, how will this reflect on prequalifying for a home loan? Do I need to wait until I have more months of the new pay in my check stubs?

Answer 1

Most lenders just need your 2 most recent paystubs to calculate income. (This applies if you have good credit.)   With a credit score of 720+, that rule of thumb should apply to you.    If you really want to cover your bases, you could have your payroll department fill out a verification of income form or type a letter on official company letter head reflecting the pay increase and provide it to a lender.

Don't be scared of the pre-qual process nor the mortgage process.  If you are employed (not self-employed), have excellent credit and little debt, it does NOT take much to get a mortgage loan.  In fact, you usually just have to provide 2 paystubs and bank statement(s). Granted nothing odd appears on your bank statement (s) or paystubs, you're set!   My company calls these "streamlines".  It's a benefit of having great credit and little debt.  (You have to provide sales contract and documents like that pertaining to the purchase of the house - I'm just talking about "personal" documentation like paystubs, tax returns, bank statements, etc.)  Even in this market, if you have excellent credit, you can get a loan pretty easily.

Answer 2

It varies from bank to bank how many months of check stubs you will need, but it's typically either just a few or up to 3 to 6 months. But it will be perfectly fine. They know people get pay increases. Since you are at the same job and it's been like that for 2 months already, then it's obvious that it's not going to decrease. You will have no problem at all. Besides, they always call your employer to verify employment and income anyway, so you won't have a problem.

If you have any doubts about it, contact the lender at the bank, they can answer this question and others for you with no problem. They will be able to tell you what all documents you will need. Believe me it is a LOT.

Good luck.

Answer 3

If you can get a letter from your employer that the pay increase is permanent, in other words, regular pay, they will use your NEW pay in underwriting purposes.