W-2 income
Employer-reported wages documented on a W-2 form. Treated by lenders as the most verifiable income type — fully documented, no write-offs, no averaging required. A self-employed borrower who also has W-2 income from a separate employer can combine both sources when qualifying.
How does this affect your loan? Estimate self-employed qualifying income with the DTI calculator, or read the self-employed mortgage guide.
Related terms
- DTI (Debt-to-Income Ratio) — The percentage of your gross monthly income that goes toward debt payments. Front-end DTI covers housing costs…
- Qualifying income — The income figure a lender actually uses when calculating your DTI — not your gross revenue, not your total de…
- Schedule C — The IRS form where sole proprietors and single-member LLCs report business income and expenses. Conventional l…
- Net income — Income after all business deductions. On a tax return, this is Schedule C net profit. It’s the number conventi…
- Form 1084 — Fannie Mae’s self-employed income analysis worksheet. Lenders use it to standardize how they calculate qualify…
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Sources
Educational definition only — not financial, legal, or tax advice. Programs and limits change; verify current terms with a licensed professional.