# What counts as income for a mortgage application?

Olivia Watson · August 4, 2026

> Rental income from investment properties can be counted towards your mortgage qualifying income, but the amount allowed varies by lender. If you have a...

Rental income from investment properties can be counted towards your mortgage qualifying income, but the amount allowed varies by lender.

If you have a secondary unit like an ADU on your property, the rental income from that may also be eligible to use for mortgage qualification.

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Income from side gigs or freelance work can be counted, but you typically need at least 2 years of documented history.

Alimony, child support, and disability income are considered non-taxable income, which lenders may value higher than regular taxable income.

Bonus, commission, and overtime income can be used, but lenders typically require a 2-year history to count the full amount.

Retirement income like Social Security, pensions, or 401(k) distributions can be counted, but may need to be likely to continue for at least 3 years.

Income from a boarder or roommate in your primary residence can be included, up to 30% of the total qualifying income.

Lenders can "gross up" non-taxable income like disability payments by 25% when calculating your qualifying income.

Capital gains income may be counted if you have a consistent history, but it's treated more cautiously than employment income.

Lump-sum inheritance or gift funds can be counted as "reserves" to help you qualify, but generally not as part of your regular income.

Income from a family-owned business can be included, but you'll need to provide extensive documentation to verify it.

Income from rental properties is calculated based on the net rental income reported on tax returns, not the gross rents.

Seasonal or part-time income can be counted if you have a 2-year history, but lenders may average it over 12 months.

VA disability income and housing allowance are fully counted as qualifying income for VA loans.

Income from investment assets like stocks or bonds is generally not counted towards your mortgage qualification, unless it's consistent dividend/interest income.

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