Can income from seasonal work, a second job, or part-time employment be used to qualify for a USDA loan?

When can income from seasonal, second job, or part-time employment be used to qualify for a USDA loan?

Whether it be retail, hospitality, agricultural, or customer service, seasonal work, a second job, and part-time employment can be found throughout several industries and this type of income can be a critical qualifying source provided USDA requirements are met.

In today’s video we will discuss how income from seasonal, second job, or part-time employment can be used to help qualify for a USDA loan.

However, before we get started, don’t forget to take advantage of our Second Chance Service which is a great way to get access to an expert opinion which can be especially helpful for those recent loan denials or if you are just in need of guidance on how to make the most out of your pre-qualification.

Can income from seasonal work, a second job, or part-time employment be used to qualify for a USDA loan?

As a starting point, USDA guidelines state the following when attempting to use income from seasonal, second job, or part-time employment for loan qualifying:

Seasonal Income

“Seasonal employment (e.g., umpiring baseball games in summer or working at a department store during the Christmas shopping season) is considered uninterrupted and may be counted if the applicant has worked the same type of job for the past two years.”

Additionally, “unemployment compensation associated with seasonal employment may be considered repayment income if the applicant has a two-year history of receipt and the unemployment compensation is likely to continue for the next three years”.

Second Job or Part-Time Employment

“Income from a second job or part-time job may be counted for repayment income if the applicant has worked this position uninterrupted for the past two years and will continue to do so.  This type of income must be likely to continue for the next three years in order to consider the income for repayment.”

 “Second or part-time job income refers to jobs taken in addition to the normal, regular employment to supplement the applicant’s income. If an applicant’s regular employment is less than a typical 40-hour work week, the stability of that income should be evaluated as any other regular, ongoing primary employment.  This would include as an example, a registered nurse that has been working 24 hours per week for the last year.”

 Conclusion

In summary, in order to utilize income from seasonal, second job, or part-time employment to qualify, USDA guidelines require that “the income must be reported on the applicant’s individual federal income tax return for the most recent two year period”.

As you can see from our video today, understanding what employment can be used and how to calculate that income for your loan qualification is critical towards maximizing your qualifying ability and establishing that all important sales price.

Remember, because we offer in-house underwriting and are known for our USDA experience, make sure to use my team as a resource and call if you have any specific questions about USDA loan well water testing requirements so we can review and advise.

USDA loans are in the blood of my entire team and as an approved USDA lender Metroplex Mortgage Services is proud to serve our rural communities!

Just call or email if you have any USDA qualifying questions, want to discuss a new scenario, or would just like to take advantage of our second chance review service which is great for both existing transactions & pre-qualifications.

(800) 806-9836 Ext. 280
SeanS@MPLX.org

I want everyone to make it a great day, and look forward to seeing you right here for the next tip of the week!