Self-Employed Mortgage Loans
Being the owner of a business comes with many perks. Although there can be long days and additional responsibility, being self-employed comes with advantageous traits when it comes to finances.
Aside from being your own boss and being financially independent, self-employment also helps you out when it comes to filing taxes. Car payments, meals, credit card interest, lease payments and various other expenses related to your business can be written off. The result of these business-related expenses, is that your annual income looks significantly lower on paper and thus will put you in a lower tax bracket. By being in a lower tax bracket, you pay a substantially smaller percentage on income taxes.
These benefits can create difficulties though when trying to buy a home. You may struggle to qualify for a mortgage because lenders see your low-level income statements and deem you unsuitable for a loan.
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Proving your income when self-employed is a not a clear picture and so many lenders will brush you off when they see your lack of income. There are strategies however, to secure a home loan despite your low-income statements. As a mortgage planner, I can use leverage available to me with my connections to lenders to develop an optimal solution.
Another common strategy to overcome this low income prejudice is to provide a substantially larger down payment on the home. Lenders that see a 20 percent down payment or higher will feel more confident in your financial capabilities to pay off the loan and approve you.
A more complicated option if offering a larger down payment is not possible, is to prove to a lender Stated Income. If you have worked at least two years previously in the same profession you are now working in as self-employed, a lender can research average income earnings for those within your profession over a large period of time. They can use this data to identify that you have the financial means to handle a mortgage payment. This avenue is more complex and only an available option for some lenders, but it is a possible route.
These are some of the few strategies and tools we can use to get you approved for a mortgage. For more strategies and assistance, please contact me at 780-370-1490 or send an email to firstname.lastname@example.org. Every lender has a different way of reviewing applications for self-employed individuals. Get in touch with me and we can find the most suitable lenders based on your financial circumstances. Make your dream of becoming a homeowner reality. Contact me today!
For more information or any questions you may have about mortgage pre-approval, give me a call at 780-370-1490 or contact me to discuss further or fill out the form below to get in touch with me about your mortgage solutions: