Why not net income when you are certainly taking home less than you earned after taxes that are mandatory? Then when you include health insurance it’s much less.
Edit:Typo
In: Economics
Because mortgage interest and taxes are deductible to a certain extent and some of these can phase out based on the total gross income not the net. Not to mention there are deductions that can increase net income. If the applicant is carrying over losses from a previous year their net income will be misleadingly high.
Gross means the mortgage vendor can work out the normal taxes, where everything should be, and the worse case scenario when considering whether the applicant meets the appropriate loan to value and debt to income ratios.
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