Self-employment can be a great journey. Being responsible for your own success and forging your own path is scary and empowering in equal measure. But it can cause issues when it’s time to buy property. Getting a mortgage as a self-employed individual is often seen as a challenge, however, Brian Decker mortgage solutions understand, and have several options available to help.
Brian Decker loan officer services have helped hundreds of self-employed individuals to obtain mortgages and purchase property, it is something we are very proud of. That does mean that we understand the challenges faced, and also have options for overcoming them.
Establishing self-employed income
One of the biggest issues for the self-employed we have seen at Brian Decker Mortgage loans is the issue of income. There are two parts to this; the first is how it is assessed. Usually, the lender will ask Brian Decker loan officer services to provide the two most recent tax returns of our client. The company then averages the two to establish an income.
There are two issues here; first, it may reduce income if the first return was significantly lower: maybe a bad year, maybe you just launched, maybe it was a year that included significant expenditure. That last point also shows the other problem self-employed clients of Brian Decker mortgage services have. It is not using your gross income but the net profit. This could skew your income drastically and reduce how much you can borrow.
There are two things Brian Decker top loan officer can do about this. The first is to push the loan company to add back some deductions to increase income. Not all deductions will be considered, but depreciation costs for vehicles, property or equipment can often be added back, and that can make a big difference.
The other Brian Decker mortgage solution is to find lenders that only require one year of tax returns, which can be a major boost if the pervious year was low. This option does come with some restrictions though, in that lenders who allow a single year return, will also expect high levels of assets, a great credit score and significant equity too. For those that qualify though, this Brian Decker loan officer solution can help establish a higher income and greater bowing ability.
Dealing with debt
Brian Decker mortgage loan options for self-employed clients usually require a stronger credit profile than an employed client would, as lenders perceive the risk to be higher. This is especially true when looking at current debt, so reducing debt exposure can really help with the application.
Excluding personal guaranteed debts paid by the business can help. These debts, although strictly a business expense, can often appear on the personal credit profile. It will require proof of business payment over the previous 12 months, no late debt payments and be included in the business tax returns, but meeting those criteria, those debts can be excluded in the application.
By leveraging these options, Brian Decker loan officer services can help the self-employed obtain the mortgage they are looking for.