Self-Employed Buyers

If You Are Self Employed

There's no doubt about it, it could be more difficult for you to get a mortgage loan if you are a free lance viola player than if you are a government accountant. Traditionally lenders have been more cautious when evaluating loan applications of buyers who are self-employed than people who work for a regular salary.

If you are self-employed, there is no reason for you to shy away from applying for a home mortgage loan, however, especially if your earnings have been in the same field for at least two years. It is a good idea to meet with one or more loan officers before you begin your search. They will probably want to analyze your tax returns for the past 2 or 3 years, keeping in mind that many self employed people can look impoverished on paper, since you can write off some expenses that salaried individuals can not. Try to get pre-approval by the lender, and ask for a letter stating that you have pre-qualified for a loan which the Realtor can attach to any offer you submit on a home. This will make you more attractive to the sellers.

Lenders Want to Say "Yes"

If you consider yourself incapable of getting credit, you may be living in the past in terms of assessing your financial situation. Lenders are now bending over backwards to give money to borrowers. A recent survey of mortgage lenders found some interesting trends. Ninety-six percent of those surveyed had cut their standard down payment requirements for moderate-income buyers. Ninety-three percent said they are more lenient in their income-ratios (the ratio of your debts to income), and 94% of those surveyed said they now have more flexible approaches to credit histories, and look at rent and utility payments more than credit cards.

Seventy-nine percent of lenders say they have relaxed employment criteria. They now look more at your capacity to generate a stable flow of income rather than requiring a long history at one job.
There are more lenders today, and they are in fierce competition with each other. The home loan industry has created entire markets that cater to those with less-than-perfect credit.

No Problem

There is no doubt about it--it could be more difficult for you to get a mortgage loan if you are a free lance viola player than if you are a government accountant. Traditionally lenders have been more cautious when evaluating loan applications of buyers who are self-employed than from those who work for a regular salary.

If you are self-employed, there is no reason for you to shy away from applying for a home mortgage loan, especially if your earnings have been in the same field for at least two years. Before you begin your search for a house, it is a good idea to meet with an agent of your choice who will be happy to accompany you as you meet with one or more loan officers. They will probably want to analyze your tax returns for the past 2 or 3 years.Because people who are self-employed can write-off many expenses that salaried individuals cannot, it is possible that self-employed individuals may look impoverished on paper.Try to get pre-approval from the lender, and ask for a letter to that effect which the Realtor can attach to any offer you submit on a home. This will make you look more attractive to the sellers.

Self-Employed

There is no doubt about it--it could be more difficult for you to get a mortgage loan if you are a free lance viola player than if you are a government accountant. Traditionally lenders have been more cautious when evaluating loan applications of buyers who are self-employed than from those who work for a regular salary.

If you are self-employed, there is no reason for you to shy away from applying for a home mortgage loan, especially if your earnings have been in the same field for at least two years. Before you begin your search for a house, it is a good idea to meet with an agent of your choice who will be happy to accompany you as you meet with one or more loan officers. They will probably want to analyze your tax returns for the past 2 or 3 years. Because people who are self-employed can write-off many expenses that salaried individuals cannot, it is possible that self-employed individuals may look impoverished on paper. Try to get pre-approval from the lender, and ask for a letter to that effect which the Realtor can attach to any offer you submit on a home. This will make you look more attractive to the sellers.