What is the term for a borrower's gross income after federal income tax deductions?

The term that accurately describes a borrower's gross income after federal income tax deductions is known as "After-Tax Income." This amount represents the actual income that a borrower has available to spend or save after the government has taken its share through taxes.

After-tax income is crucial in mortgage lending because it helps lenders assess a borrower's financial capacity to make monthly mortgage payments. By considering what borrowers actually take home, lenders can better evaluate the affordability of a mortgage for the borrower.

In this context, while "Net Effective Income" might refer to income after certain deductions, it does not specifically highlight the federal tax aspect. "Gross Effective Income" could imply the total income before any deductions, and "Adjusted Gross Income" refers to a specific figure used for tax purposes before further deductions are applied. Thus, After-Tax Income is the most accurate term for describing a borrower’s financial situation post federal income tax deductions.