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Self-Employed Mortgage Borrowers Have Options
Securing a mortgage for the self-employed can be challenging. Many don’t realize that being self-employed, a contract worker, or having their own business can affect their eligibility for a mortgage. Yet, for business owners and freelancers, there are mortgage solutions available. They’re designed for self-employed people, even in the most unique situations.
Understanding Self-Employed Mortgages
This type of mortgage is for people who run their own businesses or have irregular income. These mortgages account for the fact that self-employed people often have large write-offs that make their income seem lower than it is. Many lenders offer mortgages for self-employed people. A skilled mortgage broker can help you navigate these options and find the best one for you.
We have mortgage lenders with many different products available for self-employed borrowers. If you have less than 20% down-payment and want to buy a home, you could get approved for an insured mortgage.
If you have 20% or more down-payment or want to refinance your home, you could be eligible for a conventional mortgage. This means that no mortgage insurance is required.
Co-Signing as an Option
If you’re self-employed and struggling to get a mortgage, getting a co-signer is a good option. For instance, if your spouse has regular employment, you can use their stable income as a base. This income can help you qualify for a self-employed mortgage. This can enhance your chances of approval and potentially secure better terms.
Steps to Secure a Self-Employed Mortgage
Getting a mortgage for the self-employed doesn’t have to be daunting. Here are some steps to help you through the process:
- Gather Documentation. Lenders need more documentation from self-employed individuals. This can include tax returns, financial statements, and proof of business ownership. Ensuring you’ve got these documents ready can streamline the application process.
- Consult with a Mortgage Broker. An experienced mortgage broker is invaluable in finding the right self-employed mortgage. They can connect you with lenders who specialize in these loans. They can also guide you through the application process.
- Improve Your Financial Profile. Pay off existing debts. Improve your credit score. Ensure your financial statements are up-to-date. A strong financial profile can improve your chances of securing a mortgage.
- Consider a Co-Signer. As mentioned, a co-signer with regular employment can greatly help your mortgage application. This shows lenders that you have a stable income source backing your loan.
Advantages of a Mortgage for the Self-Employed
- Tailored Solutions. These mortgages are for the self-employed. They consider their unique finances and incomes.
- Flexible Terms. Many lenders offer flexible terms that can accommodate fluctuating incomes.
- Access to Resources. A mortgage broker gives you access to many lenders and products. This increases your chances of finding the right mortgage.
Conclusion
Securing a mortgage for the self-employed may seem challenging, but it’s achievable with the right approach and support. You can find a mortgage that fits your finances. To do so, gather the needed documents, ask an experienced broker for advice, and maybe use a co-signer.
Don’t let your employment status deter you from owning your dream home. With tailored self-employed mortgage solutions available, achieving homeownership is within your reach. Contact us today to explore options and secure a mortgage.