How Your Pay Structure Affects Mortgage Approval
As a travel nurse, your paycheck looks a little different than those of full-time, salaried employees. While your career offers flexibility, adventure, and competitive earnings, it can also present challenges when applying for a home loan. One of the biggest obstacles? Non-taxable income for travel nurses.
Travel nurses receive extra payments for housing, food, and travel, which are often not taxed and can be a great financial perk. However, this setup can make it tricky when applying for a mortgage, as lenders focus on regular income, and non-taxed payments may not be counted the same way. Payments like per-diems and housing stipends vary by lender and may require special consideration during the loan process.
With tax season around the corner, it’s a great time to organize your financial documents and understand the difference between taxable and non-taxable income to improve your mortgage approval chances.
Breaking Down Travel Nurse Income: Taxable vs. Non-Taxable
To understand how your earnings impact your mortgage eligibility, let’s first break down the two types of income you receive as a travel nurse:
Taxable Income (Counted by Most Lenders)
- Hourly Wages – The base pay rate for your contracted work.
- Overtime Pay – Any extra hours worked beyond your contract.
- Bonuses & Incentives – Some contract completion bonuses may be taxable.
This portion of your income is reported on your W-2 or 1099, making it easy for lenders to verify.
Non-Taxable Income (May NOT Be Counted by Some Lenders)
- Housing Stipends – A significant portion of your paycheck, but often not reflected in your taxable earnings.
- Meal & Incidentals Per Diem – Reimbursement for daily expenses.
- Travel Reimbursements – Money to cover your travel between assignments.
These non-taxable benefits help lower your tax liability but can create issues when applying for a mortgage if your lender doesn’t know how to account for them properly.
Why Lenders May Not Count Non-Taxable Income for Travel Nurses
Traditional mortgage lenders typically evaluate income based on W-2 wages and taxable earnings, which can be a disadvantage for travel nurses who receive a large portion of their pay through stipends.
If your lender doesn’t count your non-taxable income, it can:
❌ Make it seem like you earn less than you actually do.
❌ Lower your borrowing power and loan amount.
❌ Make it harder to meet debt-to-income (DTI) ratio requirements.
The good news? Some mortgage programs do count non-taxable income—but you need the right mortgage advisor to help document it properly.
How Paul Defngin Helps Travel Nurses Get Mortgage Approval
As a Senior Mortgage Advisor at The Yi Team Mortgage, Paul Defngin specializes in helping travel nurses maximize their home loan eligibility. He understands the nuances of your income structure and works with lenders who are familiar with counting non-taxable stipends.
Here’s how Paul can help:
✔ Selecting the Right Loan Program – Not all lenders view non-taxable income the same way. Paul works closely with you to determine your eligibility and help you select the best loan option for your needs.
✔ Income Documentation Strategies – By compiling W-2s, pay stubs, tax returns, and contracts, Paul ensures lenders see the full picture of your earning potential.
✔ Custom Mortgage Planning – Paul works with travel nurses before they apply for a loan, helping them improve debt-to-income ratios, strengthen financial profiles, and qualify for higher loan amounts.
If you’re a travel nurse looking to buy a home in 2024, now is the time to prepare your finances for a smooth mortgage process!
Follow Paul on Instagram and Facebook for more tips on income for travel nurses.
Tax Season Checklist: 5 Steps Travel Nurses Should Take Now
Since it’s March and tax season is here, take these steps now to get financially organized and mortgage-ready:
1. Organize Pay Stubs & Tax Forms
- Gather your W-2s, 1099s, and contract agreements from the past two years.
- Make copies of pay stubs showing stipends and hourly wages.
2. Verify Income with a Mortgage Expert
- Not all lenders handle travel nurse income the same way.
- Paul Defngin can review your income and make sure it’s documented properly for loan approval.
3. Review Your Tax Deductions
- Travel nurses often deduct housing, meals, and travel expenses—but be cautious!
- Excessive deductions could lower your taxable income too much, making it harder to qualify for a mortgage.
4. Check Your Debt-to-Income Ratio (DTI)
- Pay down credit card balances and avoid taking on new debt before applying for a loan.
- A lower DTI ratio improves your mortgage eligibility.
5. Start Your Mortgage Pre-Approval
- If homebuying is on your radar for 2025 or 2026, now is the best time to start planning.
- Pre-approval helps you understand your budget and loan options before you start shopping for homes.
Get Mortgage-Ready This Tax Season!
Tax season is the perfect time for travel nurses to get their finances in order and prepare for homeownership. Understanding how taxable vs. non-taxable income affects your loan approval is key to maximizing your mortgage potential.
Paul Defngin and The Yi Team Mortgage specialize in helping travel nurses like you secure home loans, even with a complex income structure. Whether you’re planning to buy now or in the future, Paul can guide you through the process, ensuring your true earnings are counted.
Next Steps
📥 Download our FREE Travel Nurse Homebuying Checklist, below!
📞 Contact Paul Defngin today for a personalized mortgage consultation!
Your homeownership journey starts here—don’t let non-taxable income hold you back!
Why Choose Paul Defngin and The Yi Team for Your Home Loan?
- Expert Guidance for Travel Nurses: Paul has extensive experience working with travel nurses, so he understands your income structure and can present your financial profile in the best light.
- Custom Loan Options: Paul will help you explore loan programs that match your lifestyle and financial goals.
- Streamlined Process: Paul’s team is committed to making the mortgage process as smooth as possible, so you can focus on what matters—your career and finding the perfect home.
- PDefngin@TheYiTeam.com | 240-447-2376
DISCLAIMER: Financial assistance programs are available on a first-come, first-served bases. Eligibility for assistance require meeting specific parameters and criteria. Program availability, terms, and conditions are subject to change. Not all applicants will qualify. Please consult with Paul Defngin to determine your eligibility and for complete program details.
SPECIAL ASSISTANCE PROGRAM DISCLOSURE: Down payment and closing cost assistance ranging from $15,000-$20,000 is made available through various state, federal, and private programs. This is not a committment to lend. All programs are subject to borrower and property qualification including, but not limited to: income limites, geographic restrictions, property type restrictions, and occupation verification. Programs, rates, terms and conditions are subject to change without notice. Additional restrictions may apply. Assistance amounts vary based on program eligibility and qualifications.
Paul Defngin NMLS #199791 | The Yi Team Mortgage NMLS #1657323 | nmlsconsumeraccess.org | Equal Housing Lender
Contact Paul Defngin at The Yi Team Mortgage to learn how we can help make your homeownership dreams a reality.