Expected income refers to income from cost-of-living adjustments, performance raises, a new job, or retirement that has not been, but will be received within 60 days of mortgage closing. The Mortgagee must verify and document the existence and amount of expected income with the employer in writing and that it is guaranteed to begin within 60 days of mortgage closing. Income is calculated in accordance with the standards for the type of income being received. The Mortgagee must also verify that the borrower will have sufficient income or cash reserves to support the mortgage payment and any other obligations between mortgage closing and the beginning of the receipt of the income.
For additional information see Handbook 4000.1 II.A.4.c.xii(L) or II.A.5.b.xii(L) available at https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh