Income Allowances in Texas

What Are Mortgage Income Allowances?

Mortgage income allowances are extra payments you might receive on top of your base salary to cover specific expenses. These payments are common in certain industries and military roles, and they include:

• Automobile allowances
• Housing or parsonage allowances
• Military allowances like combat pay or rations

Each type is treated a little differently depending on how long you’ve received it, how it’s reported on your tax returns, and the mortgage program you’re using. At Mortgage Mark, we help borrowers throughout Texas, including those here in Dallas, make sure these income sources are counted correctly.

Automobile Allowance

Does a Car Allowance Count as Income for a Mortgage?

Yes, a car allowance can count as income—but it depends on how it’s structured. If your employer gives you a regular stipend to help with gas, maintenance, or car-related travel, and you’ve received it for at least two years, it may be included in your qualifying income.

This comes up often for sales professionals, consultants, and field workers—especially here in Dallas, where driving is a big part of the job. We’ve helped many clients throughout Texas qualify using properly documented auto allowances.

There are two ways to approach this:

1. Actual Cash Flow Method
If the allowance is reported on Form 2106 or Schedule C:

• Any extra funds above your actual car expenses can be added to your income
• If your expenses are higher than the allowance, that difference may be added to your debts
• If you itemize actual expenses, we’ll look at your lease or loan and adjust accordingly

2. Income and Debt Method
If the allowance isn’t reported on your tax returns:

• The full amount of the allowance may be added to your income
• The full car payment will also count as a liability

We’ll walk through both methods and use what helps you qualify while staying within guidelines.

Housing Allowance Income in Dallas and Across Texas

Housing allowance income is common for those working in churches, nonprofits, and ministries. In Dallas and throughout Texas, we work with many borrowers who receive these types of stipends to help with housing costs.

To qualify this as income:

• You need a 12-month history of receiving it
• It must be likely to continue for at least 3 more years
• It can be added to your income, but not used to directly offset your mortgage payment

For example, a pastor at a Dallas-area church might receive a parsonage allowance to help cover rent or housing costs. If it meets Fannie Mae or Freddie Mac guidelines, we can absolutely count that income when calculating your qualifying numbers.

Whether you’re based in North Texas, the Houston area, or elsewhere in the state, we’re familiar with these cases and can walk you through exactly what’s needed.

Note: Military housing allowances follow separate rules (see below)

Military Income Allowances

We’re proud to serve our military borrowers across Texas—from DFW to San Antonio, Killeen, El Paso, and beyond. Military income often includes several types of allowances in addition to base pay. These are usually counted as stable, qualifying income.

Common military allowances include:

• Combat pay
• Flight pay
• Hazard pay
• Rations and quarters allowances
• Clothing allowance
• Overseas pay
• Variable housing allowance

VA loans have very clear guidelines for counting these types of income, and we help active-duty service members and veterans throughout Texas get the credit they deserve.

Whether you’re stationed near Fort Cavazos, serving in the Air Force near Dallas, or transitioning out of active duty, we can help make your income work for your home loan.