Self Employed Mortgages in Indiana
10 January 2008Thinking of buying property in the wonderful state of Indiana? You are not alone! Each year, thousands of home owners decide to make the jump in the “Land of the Indians.”
But wait a minute…You are self employed. Will this make it more difficult to get a mortgage for your new home in Indiana?
In the past, it has been hard for self employed individuals to get mortgages. Lenders tend to prefer to see a regular income coming in – the kind of regular income that is guaranteed by employment. But in recent years, this has begun to change. There is an increasing number of lenders who deal exclusively with the self employed. There are also a lot of conventional lenders who are willing to offer loans to self employed individuals. If you have extensive experience in a particular industry, this could work quite well to your advantage. Most of all, lenders want to see that you are an employable individual.
If you have only recently started working in your new field of expertise, however, this might be a problem. Until you get to the point where you are able to earn a regular income, most lenders will not be willing to take the risk. If you are working on a short term contract, it will help your case a great deal if you can show that you also have a regular contract of some sort with the same employer – a contract that has been renewed. The longer the contract has lasted for, the better your chances of getting a quality loan will be. Still, other lenders may want to see a pattern of contractual renewals that stretches up to a two year period.
If you are self employed, then lenders will have a certain criteria that they will expect you to meet in order to give you a mortgage. They might ask to see up to three years of certified business accounts before you qualify for a mortgage loan. At the same time, lenders are becoming more and more flexible over the years. If you currently own a home and can prove that you have a good repayment history, then that very well may seal the deal on your loan application. Oftentimes, however, self employed individuals find the best deals with mortgage companies that specialize in self employed workers. If you go for self certification, you will be able to state your income with providing proof in the vast majority of cases. Although your credit will be checked, you can avoid having to deal with certified account problems that so many self employed people experience during this process. This can make the loan process a lot simpler and less stressful.
At the same time, if you are unable to prove your income, or your income fluctuates wildly from month to month, you might experience problems when attempting to get a self employed mortgage. The vast majority of lenders only take in to consideration net income, rather than gross income, when they calculate the total amount they are able to lend you.
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