Hardship Qualifications for Banks and Mortgage Lenders

The bank will not consider this a "hardship", however you will be required to qualify based on your most current income. This is true for W2 emplyees if you are now making less income. If you are a commissioned employee, they will use an average of gross commissions that you have recieved over the past two years. ( This may work in your benefit ).

If you are self employed, a bank looks at an average of 2 years tax returns ( Net income on schedule C + depreciation added back in ) and a Year to Date profit and loss. Hopefully this answers your question. If you need any more details feel free to contact me.

Yes, but if your current income is enough to cover a mortgage payment plus your other expenses they may only ask for an explanation of why the decline in income if you are looking to purchase a home.

I'm not sure if this is the answer you were looking for, you mentioned the word hardship in your question which to me would indicate perhaps you might be behind on mortgage payments. If this is the case then the lender will definitely consider this a hardship and might work with you until you can get back on your feet, but keep in mind not all banks will work with the homeowner directly. In many cases I have helped talk to the bank and helped homeowners stay in there home. There are many options a homeowner has but are not aware of them.