Self Employed Borrowers & Mortgages

Being self employed leaves you with the freedom to make your own decision as well as not have to answer to a boss. Unfortunately, it is not the 90's anymore, when borrowers only needed a few months of bank statement to show your cash flow. Now self- employed borrowers must prove their income with two years of tax returns instead of using a stated income loan.

Declining income is most likely a result of the recession, but for someone who is attempting to qualify for a loan that takes the average of the past few tax returns; this can actually prevent a borrower from qualifying for the loan.  

Many self-employed borrowers report the gross income minus their expenses for a net income. It is more beneficial to have the net as low as possible, but the net is what they use to qualify the borrowers income. They have to ask themselves "what is more important? Being approved for a larger loan or avoid paying taxes?" 

They must also prove their business exists. In addition to the tax returns a lender may request the following: 

1. Written statement from their accountant.

2. Business License

3. Website

4. Client Statement

5. 1099

What are the Mortgage Do's & Don't?

The home buying process is no walk through the park. There are many little mistakes or oversights that could be made during the process that can cost you the home of your dreams. Here are a few do's and don't that can help keep you on the right path.

Do...

...disclose all your income and debts. i.e. side business, alimony, child support, additional homes that you may own

...be prepared to provide a great deal of financial documentation

...keep paying your bills

...pay your existing mortgage/rent on time.

...be upfront about your credit. Good, Bad, or otherwise.

Don't...

...quit or change our job

...open any new lines of credit or finance/buy any large purchases i.e.cars, furniture, boat, or RV

...incur overdraft fees

...make ANY cash deposits

...pay off debts or close accounts without speaking to a mortgage professional

...DON'T MOVE!

For more information, give me a call! 

Big Job Change

Hey everyone, sorry for the delay in updating my blog.  As you may be aware there are lot's of things going on in the mortgage industry recently keeping me very busy.  There are many great opportunities for new home purchases and mortgage rates are at historic lows.

I am excited to announce my affiliation with the The Mortgage Firm, which has recently expanded their operations into South Florida. 

Headquartered in Orlando, Florida, The Mortgage Firm has been providing quality real estate financing since 1995. With a proven track record, we serve the lending needs of real estate professionals, builders and individual homebuyers throughout Florida and Georgia.

Our qualified and licensed professionals offer expertise in every area of mortgage lending: Conventional, FHA, VA and USDA.

We have access to a full range of mortgage sources and all of our lending specialists are dedicated to find the right loan with the best rate, terms and cost to meet your unique needs. But that’s just the beginning. Throughout the lending process, our talented staff will provide regular updates and progress reports so you know exactly where you stand, in person or online.

Now more than ever, experienced people and solid financial resources are two of the most important qualities to look for in a lender. With 15 years of success, The Mortgage Firm is a bonded, insured and licensed loan originator that offers both. We are committed to responsible lending and are well capitalized for the regulatory and industry changes to come.

Whether you are dreaming of buying your first home, lowering your existing payments or considering investment properties or home improvements, I can help by offering a variety of mortgage loan programs.  Even if you have had recent credit issues, I can help.  Call me today!