Posted on: 27th Sep, 2008 03:16 am
I would like to purchase a new home via fha mortgage. Can I sell my current home on land contract and use that income to offset the mortgage on that property. I heard rental income until sale can no longer be used on a fha mortgage.
Hi Guest!
If the income is positive it is added to a borrower's gross income whereas if its negative, then the income becomes a liability. According to the guidelines, you will have to show them the copies of last 2 years Schedule E and the full tax return while documenting rental income. You can use the following formula to calculate the net rental income of yours.
Schedule E Line 26 - Total rental real estate and royalty income or (loss).
ADD BACK
Line 20 - Depreciation expense or depletion
= Net Rental Income
Thanks,
Jerry
If the income is positive it is added to a borrower's gross income whereas if its negative, then the income becomes a liability. According to the guidelines, you will have to show them the copies of last 2 years Schedule E and the full tax return while documenting rental income. You can use the following formula to calculate the net rental income of yours.
Schedule E Line 26 - Total rental real estate and royalty income or (loss).
ADD BACK
Line 20 - Depreciation expense or depletion
= Net Rental Income
Thanks,
Jerry
i agree with jerry.