Can The Self Employed Get A Mortgage Loan?

When you work as a self employed worker sometimes it can be difficult to get approved for a mortgage loan. While the self employed worker is not viewed as an attractive home buyer, obtaining a loan is not impossible.

Traditionally, self employed workers were able to get a non-documentation loan but that was abolished when the sub-prime market tanked. Now everyone must prove they earn a living in order to get approved for a mortgage loan, so that will be your first step to prove steady self employed income.

• You’ll have to show a minimum of two to three years' tax statements or company accounts signed off by a qualified accountant and you'll be assessed on your profits

• Accountants use many legal loopholes to reduce your tax burden by reducing your stated profits but when applying for a mortgage loan, this may work against you because of the stated lower income.

• Make sure you have accounts paid on time. If you have good credit and a good credit report then that goes in your favor. If you can show that you’re a self employed worker who has steady profits and has managed to pay your bills on time, this will rate highly in your favor.

• You should have a healthy savings account to show that you have collateral and you’re responsible enough to save for your future.

If banks are still hesitating approval of your mortgage loan, try to get a loan from the smaller banks in your local area. Community banks and credit unions may be more willing to give you a loan.

The self employed group has grown over the past few years due to the quick rise in unemployment so banks understand the hiccups and underwriters are accustomed to the demand for mortgage loans.

And surprisingly, banks are already looking for a mortgage product to market to the self employed group.