It is not as difficult as you may think to qualify for a home loan financing if you are self-employed. Sure as a W-2 wage earner the lender just calls the employer to verify the income, but being self-employed the lender won’t just call you since you are the borrower. Each lender may vary a little but this is what the majority look for.
Full-Doc Loan
This is for those who can offer plenty of proof of income. Here is what the lender will want to see: two most recent tax returns, a current year-to-date profit and loss statement and balance statement, business license, verify all assets and recent bank statements.
Low-Doc Loan
You will need one to two years bank statements, CPA Letter, verify assets and business license.
No-Doc Loan
You just state your income and assets and the lender does not verify accuracy.
Now, as you may have guessed, the less the lender verifies the higher the interest rate will be. And the lower your loan to value percentage will be (the loan amount is based on the percentage of the appraised value of the property). So you will be able to borrow less of a percentage of the value of the property.
As always, your credit score will affect your interest rate, but the good thing is that anyone of these types of loans can be done even if your credit score is low. But of course, again, the interest rate will be higher because of this factor also.
Your best bet is to speak with a knowledgeable Home Loan Advisor who will answer all your questions and steer you in the right direction.
