Self-Employed Borrowers

    Self-Employed Borrowers

    Home Buying

    February 25 2019

    Many think that just because they are self-employed, they can’t apply for a mortgage, and today in Sean La Rue Home Loans we are going to explain why that’s very far from true.

    One of the main questions is: How long must you be self-employed to get a mortgage?

    You may not have to show a 24-month self-employment history to get a mortgage. For instance, Fannie Mae says that you may qualify with 12 months of self-employment if you have previous experience in that field, and your income is at least as much as you earned in that field before becoming self-employed.

    Mortgages for self-employed borrowers

    Let’s go over the usual requirements

    Proving business income

    Self-employed borrowers no longer need to prove access to the business income.

    The applicant, however, may still need to show that the business earns enough to support income withdrawals.

    One year of tax returns

    Self-employed borrowers may qualify with just one year of tax returns. Those returns must show at least 12 months of self-employment income.

    The debt-to-income ratio will also have to meet the lender’s guidelines.

    Self-employed “side” income

    Borrowers qualifying for a mortgage using the income of their “regular” job don’t have to prove what they make on the side from their business. This side income could be

    Self-employed co-borrowers

    If you decide to apply for a loan with your own income, and your co-borrower is self-employed, lenders can ignore that business in underwriting.

    Income inconsistency

    If your income is consistent you’ll be in a safe area. However, if it suffers ups and downs, you won’t be able to use it to apply for a loan.

    Make sure to explain properly any decreases that your income has suffered along the years.

    So that’s all for today, hope you found this article useful so far and don’t hesitate in reaching me out if you have any questions or need a consultation.

    Ask A Mortgage Banker / September 13 2022

    Ask A Mortgage Banker: What Are 1031 Exchanges And How Do They Work?

    The 1031 Exchange is a provision in the IRS tax code. It allows investors to sell an investment property, buy another investment property and defer paying capital gains taxes on the sale. The 1031 Exchange is a provision in the IRS tax code. It allows investors to sell an investment property, buy another investment property […]

    Read More

    Featured Luxury Listing / September 12 2022

    Featured Luxury Listing: 57349 Merion, La Quinta, CA 92253

    57349 Merion, La Quinta, CA 92253 $3,000,000 8 Bedroom 9 Bathroom 6,779 Square Feet For more information, please contact: Angela Maciel Gibbons | (760) 880-8568 | [email protected] Click Here To View Full Listing   A cosmic combination of Santa Rosa Mountains, the lake & private Golf course views. Merion Estate is two homes in one […]

    Read More

    Franklin Loan Center NMLS #237653 Licensed by the Department of Financial Protection & Innovation under the California Residential Mortgage Lending Act, 4131316

    Copyright © 2022 Franklin. All Rights Reserved.