Setting up your own business, no matter how big or small it is, gives you a chance for growth. If handled properly, your business can prosper and might even be a better source of income than a regular paying job. But there will surely come a time when you would just like to settle in a place where you can call your own. Getting a mortgage, especially if you are self- employed has its own process. Although you may be earning more than a regular employee, lenders find it difficult to assess self- employed individuals. This is because it covers various business types and different level of incomes. But there are different ways on how you can prove these lenders that you are more than capable of paying your mortgage.
Most lenders will want to check your tax returns or bank accounts for the past two to three years. You can prove your financial capacity through the following steps:
Get a certified or chartered accountant to prepare the necessary documents as proof of your financial stability. Most lenders, just like in Texas, will accept this as a form of evidence if it was provided by a certified or chartered accountant.
It would be easier for you and your hired accountant if you were able to keep track of your accounts and other bank statements. Some lenders will not be happy if you provide them with out-of-date figures. You all have a note of all your expenses including your bills and even maintenance payments. Reducing your average costs in a year will definitely help you with your mortgage once it gets approved.
If approved, your lender will ask you to deposit at least 20% to your mortgage. Saving money will surely help you out once your mortgage has been approved.
Having a good credit score can boost your chances of getting a mortgage. Aside from your personal credit score, lenders will also run a credit check on your business. So make sure that your business’ credit score also has a clean record.
Although it is a bit more complicated, getting your mortgage approved is not as impossible as what other people would assume. It is always a good idea to ask advice from both your chartered accountant and your broker. Speaking to a legitimate mortgage broker about your options would definitely help. Most brokers know lenders who can offer you the best rate and some may even accept less than two years account. You can also speak to your current lender to see if there are any other options to prove your financial capacity.<< Back to the list.
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Primary Residential Mortgage, Inc.
Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. This is not a commitment to lend. Programs, rates, terms and conditions are subject to change without notice.