In this episode we go through what self-employed borrowers need to show us to get a mortgage. Self-employed folks are perhaps the hardest working borrowers we come across and, unfortunately, banks don’t cut them any slack when it comes to getting approved for a mortgage. Self-employed borrowers make up about 30% of our applications. When it comes to self-employed borrowers, we ask two questions when you call us about getting pre-qualified or how the process works.
Do you pay taxes and how big is your tax payment?
What’s your net income and how long have you been making it?
Now, if you pay a lot of taxes, you’re probably in business and you can probably get a loan. For the second question, the ideal minimum number is two years. Every once in a while, you can get away with something less than that, but typically the self-employed borrower will be less stranded and frustrated if you go into a loan originator’s office and the loan originator tells them that one year should be fine.
When it comes to documentation, when you have to prove to the underwriters and the bank, tax returns are the universal documentation we’re all going to go to. When it comes to being self-employed you either pay low taxes, or you show a lot of money and can get financing, which is another way of saying it all comes down to net income.
For a walkthrough of taxes, check out [3:52] in the video of this podcast.
If you have any questions about this or if you have any questions you’d like us to answer on our podcast, you can email your questions to firstname.lastname@example.org or give us a call at (602) 535-2171. Be sure to ask us for a free quote on your next mortgage. We’ll personally work with you and help you through the whole process.
Thanks for listening and reading the Mortgage Brothers Show. Let us know if you have any questions you’d like us to answer on this podcast. You can email your questions to Tom@AZMortgageBrothers.com or Eddie@AZMortgageBrothers.com.
Be sure to ask us for a free quote on your next mortgage. We’ll personally work with you and help you through the whole process.
Signature Home Loans LLC does not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only. You should consult your own tax, legal, and accounting advisors before engaging in any transaction. Signature Home Loans NMLS 1007154, NMLS #210917 and 1618695. Equal housing lender.BACK TO LIST