There are some very large advantages to being self-employed. But along with the freedom of being your own boss, most Bay Area residents probably thought one of the things they wouldn't have much choice about is their mortgage. After all, mortgage lenders are traditionally hard on self-employed borrowers right ??? Well that may not be as true a statement as it used to be.
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In fact, Luke Currier, a Mortgage Expert with Peregrine Lending Company says it might actually be easier to get a mortgage when you're self-employed... If you know where to look. "What most Bay Area residents don't realize is that many banks are looking to work with self-employed borrowers," says Luke Currier.
"Many banks have designed unique loans to cater to the entrepreneur; you might actually wind up going through less hassle during the process than the typical borrower who collects a salary for his livelihood."
Here are some quick pointers on shipping for a loan when you're self-employed:
“ What most Bay Area residents don't realize is that many banks are looking to work with self-employed borrowers ”
* Look for lenders that will let you verify your income in ways that don't require tax returns or pay stubs. Bank statements, for example, can be much better indicators of cash flow. There are even lenders who will accept a 1099 form as evidence of income.
* Explore no-doc loans. No-doc means what it sounds like - you don't have to provide all of the supporting documentation most borrowers do. These types of loans ask for no information about where you work or how much you earn. You'll usually need reasonably good credit scores (620 or more) and at least 5% down payment/equity for this type of loan.
* Get your accountant to sign off on a profit & loss statement. Some lenders can use these as verification of your income from self-employment. This should be a simple thing to put together, especially if you have an accountant prepare your taxes every year.
* Ask the experts. Entrepreneurs don't have the time to shop around for lenders who offer these kinds of loans. So do what you'd do in your business. Ask an expert. Mortgage brokers have access to dozens of lenders and mortgage products many people don't even know exist. They can streamline the process and make it easy to get the home you want at a price you can afford.
All this said it seems that getting a loan could very well be easier for the self-employed borrower to obtain home financing. As always it is best to do adequate research for yourself and always ask for references when speaking with a potential mortgage banker or broker. If someone can't give you at least 3 people that you can talk to about the service they received from that broker, then they aren't worth trusting your largest financial transaction too.
About the Author:
Walnut Creek, California-based mortgage experts Ed Jeffry and Luke Currier specialize in providing information to consumers that allow them to make informed decisions about their mortgage financing options. Visit them at
http://www.BayAreaLoanAdvisor.com or call them at Peregrine Lending at 925-627-2649.
Source:
www.isnare.com
