Mortgages For The Self Employed: Stated Income Loans 2014
Being self employed has its benefits, for instance making your own schedule and being your own boss. On the other hand, being self employed can also make it difficult to be eligible to qualify for a mortgage loan. This is due to the fact that most self employed individuals write off their business expenses at the end of the year in an effort to decrease their tax burden. Reciprocally, this lowered income amount that gets reported to the IRS gets factored in by banks during the conventional loan application process.
Stated income loans 2014 have been making a comeback on the secondary private lending market as lenders look to fill the demand for mortgages. While the stated income loans associated with the housing market crisis in 2008 (also referred to as “liars loans”) have long since disappeared, this new form of stated income are meant for the most qualified borrowers. Thus, lenders require FICO scores of 720 or higher with a down payment likely to be 30% or more with reserves that will cover monthly obligations for up to six months. In addition, lenders will also require that you provide the source for your income and your employment history for the past two years. Furthermore, stated income loan rates will be higher than conventional mortgage rates.
Today’s self employed must weigh the importance between lowering their tax burdens at the end of the year or increasing their odds of qualifying for larger qualified mortgages at lower rates.
For more information on stated income loans 2014, contact the specialists at HML Investments today.