# Why is a paystub preferred over a paycheck?

**URL:** <https://boards.straightdope.com/t/why-is-a-paystub-preferred-over-a-paycheck/557720>\
**Category:** In My Humble Opinion\
**Created:** [October 19, 2010, 11:49pm UTC](https://boards.straightdope.com/t/why-is-a-paystub-preferred-over-a-paycheck/557720 "2010-10-19T23:49:39Z")\
**Posts on this page:** 2\
**Page:** 3

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**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\
**Post date:** [October 21, 2010, 7:52pm UTC](https://boards.straightdope.com/t/why-is-a-paystub-preferred-over-a-paycheck/557720/41 "2010-10-21T19:52:00Z")

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> [@Stoid](#):
>
> C’mon… how much other than taxes do 99% of people have deducted from their gross pay that’s realistically likely to be in play? Gonna give up health insurance to qualify for credit?
> 
> And besides, if you fill out a loan app and state that you earn $1000, and you produce cancelled checks showin you earned $1000, it seems that’s all that should matter. If you really earn $1500 but $500 goes to health insurance and taxes, you obviously have elected not to include that $500 and don’t intend to, so again, what difference?
> 
> It’s all very silly.

Many people have 6% of their gross income deducted for their 401Ks. That can be stopped at any time, and is a hefty chunk. I’d say in general for the same net income, the person who gets it after saving 6% is a better credit risk than the person who gets it without saving anything, all things being equal. The lender has no way of making this distinction without the stub.

So, why do you want to use a canceled check again?

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**Author:** ![Basandre](https://avatars.discourse-cdn.com/v4/letter/b/bcef8e/32.png) [@Basandre](https://boards.straightdope.com/u/Basandre)\
**Post date:** [October 22, 2010, 12:29am UTC](https://boards.straightdope.com/t/why-is-a-paystub-preferred-over-a-paycheck/557720/42 "2010-10-22T00:29:32Z")

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In addition to the other reasons already given for why gross pay and not net pay, don’t forget those ratios. They’re calibrated for gross pay. There are guidelines for lenders that say things like “maximum debt:income ratio for a borrower with no housing payment is 35%.” That’s gross monthly income to debt payments - actual debt including things like child support but not including things like utility bills. Computers filled with data have determined the risk involved in lending to people with a debt ratio of x%, and each individual lending business is free to determine for themselves what kind of risk they’re willing to assume. Also, let’s not forget that things like disability and unemployment insurance pay out based on a percentage of your gross pay.

Of course no one will give up health insurance to qualify for a loan - they don’t have to, given that the lenders qualify them based on gross pay. They also don’t have to tell their company to stop withholding for taxes, no really, I’ll pay them myself in April, to qualify, because that wouldn’t help either. I can fiddle with my net pay a bit by changing my withholding and my insurance coverage, but my gross pay only changes when my employer changes it (or I change employers).

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