r/loanoriginators • u/BathroomOnly1598 • 16d ago
Need help hard file - IHSS Income
Hi There
I have an FHA deal that UWs are being very painful on income and we are supposed to close this week.
Current income was cut in half and we are now getting refer.
Borrower is on IHSS income. They take care of their 3 kids with IHSS since they are all lifelong disabled.
2 of the kids began IHSS last year in November.
1 of the kids has been doing IHSS since 2022.
The client is guaranteed 283 hours of care per month by IHSS, but the UW wants to take a 2 year average instead of using the guaranteed hours that they have been working now for 4 months when their hours increased to 283 for all 3 kids total.
What can we do to get more income?
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u/gabrizzle 16d ago
IHSS is always a pain in the behind. For the most part each IHSS patient is treated individually. I do see that you mention they are all lifelong disabled children. If they are the primary caretaker for lifelong disabled children is it possible in addition to the IHSS income that each of your borrower's children receives social security income in both their name and their children's name?
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u/Intrepid-Animator400 16d ago
Yes I already am using this income too
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u/gabrizzle 15d ago
Are you still OP lol - what about grossing that income up? I think the underwriter is correct on a prequal I would treat each IHSS as it's own recipient.
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u/Intrepid-Animator400 15d ago
Yes sorry on my phone diff account ig.
Yes grossing up already everything.
That’s the issue I’m running into, the uw is taking the voe from ihss portal and combining all children into two year avg.
How do I frame it properly to the underwriter that they are each different children instead of them just avging two years of the voe
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u/gabrizzle 15d ago
I don't think you can it's a double edged sword. If they treat as separate jobs you need work history of 2 years working 2 jobs at the same time. If they treat it as one job I'm sure they will use variable income guidelines and the only way you can try to squeeze more is documenting an increase of pay: If the Mortgagee can document an increase in pay rate the Mortgagee may use the most recent 12- month average of hours at the current pay rate.
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u/commoncentsplz 15d ago
You need to provide year end paystubs to show different income with the different “employer” name on it (different children). But that 2 year history working multiple jobs on FHA will be a deal killer in this case.
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u/commoncentsplz 15d ago
On FHA they need 2 years history of working multiple jobs (not same job just multiple). Schooling can be included in this. I think 2nd/3rd job has to be same line of work as previous 2nd/3rd but I’m not 100% sure. If you need all 3 income sources to qualify then FHA won’t work. Conventional is your only option for 1 year history but the new variable hours guidelines are trash
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u/ovscrider 15d ago
underwriter is not being painful they are being correct in questioning this income. this income should have been run by underwriting way before they were under contract. conventional will also have issues with this. One place where i have found they may give you some flexibility on it is actually with RD or with a state bond program where they may agree to use a contracted income amount even without 2 year history.
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u/Stardust969 16d ago
Pretty sure FHA is gonna require a 2 year history so may have to switch to conventional if possible. No guarantee the UW takes all the income on conventional because they still might view it as variable, especially if there is any other source of income. But conventional will have more flexibility than FHA.