Self-employment can provide great freedom for many people. It can also bring financial challenges. One of the many challenges that self-employment can bring is proving your income to a financial institution so that you can buy a house.
Financial institutions always want buyers to have good credit before agreeing to a new mortgage loan. This is not negotiable. What can be negotiated is the amount of documentation that you have to otherwise provide. If you are self-employed, a financial institution will want to see your credit history first and foremost. If that history is good, then you can move forward with the mortgage loan process.
Confirming income is the hardest portion of the mortgage loan process for the self-employed. Under a “low-doc” loan, you can provide statements from your accountant, bank statements, tax documents and confirm your income in writing so that you can sign a mortgage loan contract with the bank. Though this process may require more personal guarantees and income verification, it is simply the path you must take if you are self-employed and want to buy a house.
Do not let the fear of the mortgage process push you away if you are self-employed. If you have good credit and plenty of documentation of your monthly income, you should be able to obtain a mortgage. Check with a local financial institution to determine the process for these low-doc loans if you are self-employed.
Mortgage House
At Mortgage House, we’re no strangers to the homeowner’s journey. It’s a long (but rewarding) one.
But don’t worry, we can help with that.
If you’re thinking of buying a home, you can contact us for information about the best options for you when it comes to your mortgage.
