Mortgages for the Self Employed

 

So you have worked hard, because you had a goal: "Be my own boss!" You are finally your own boss and own your own business, you are making money that goes into your own pocket and you are working the hours you want to work - you are finally where you want to be! Now you want to purchase a home, but you are having a hard time finding a mortgage because you are self-employed! This is the story that the majority of self employed people have that are currently looking for a loan to purchase a home or even refinance one that they already own.

 

 

Source: bizjournals

 

 

Why? Two reasons, firstly their tax returns do not reflect their actual take home income! (Isn't one of the benefits of owning your own business that you can write off all eligible business expenses, thereby reducing your taxable income?) and secondly, income varies unlike a paycheck.

 

Before the collapse that led to the economic crunch a few years ago, self employed people could take advantage of Stated Income Stated Assets (SIVA) or No Income No Assets (NINA) loans, but these are very rare to come by at present.

 

So is there hope for self employed people to get a mortgage? Yes but to be frank it is harder to get a mortgage if you are self employed then it would be if you had a regular paycheck. Lenders usually require two years of both business tax returns and individual tax returns, a CPA letter confirming that you have been in business for at least two years and a year to date profit and loss statement.

 

Additionally, self employed borrowers will need to have good FICO scores, be at least 25% owners of the business and have cash reserves of six months. 

 

If you do not have all the above, there still may be hope for you! There are portfolio lenders that will lend based on individual situations, but you need to work with an experienced broker in this niche as these lenders are few and known to brokers specializing in those loan types.

 

Smita Patel of Loan People USA has worked with self employed borrowers for many years, if you are looking for a home loan for self employed please call her at (949) 313-7333. 

 

Morrtgage to buy a home

First Time Buyer Mortgages

Buying your first home is an exciting process but can also be intimidating, especially if you will be obtaining a mortgage. The real estate will probably be one of your biggest investments to date, having some guidance and assistance during the mortgage approval process can really help. So who do you go to? usually it would be to an independent mortgage professional or mortgage broker, who will guide you through the mortgage approval process so that you will be educated and comfortable at every step. They will also help in getting the best mortgage for your situation.

There are many types of Home Loans available to suit different situations. A Mortgage Broker is knowledgeable in these types and can help with making the right choice and to get the best mortgage. Things that may affect the mortgage decision would be such things as:

• Closing Costs
• Variable v Fixed Rates
• Income Sources etc.

First Time Buyer Mortgages are available to get you on the road to home ownership, let us at Loan People USA help you make the right choice for your situation! Call us at (949) 313-7333 - we would love to help you get the best mortgage to suit your needs!