Anonymous
Anonymous asked in Business & FinanceCredit · 1 decade ago

Why is it so hard to get a mortgage as a self-employed person?

I recently applied for a loan on "Lending Tree" and was denied a loan from any bank. Despite the fact that I have a 740+ FICO and

have been gainfully self-employed for 7 years, not to mention I have taken over the business of the shop for the last 2 years.

I have a small debt and have paid 1/3 of a car loan, other then that I still at least 1500 dollars left available to apply towords a mortgage payment?

What gives, this is discrimination against the self-employed !

Update:

If your employed you can lose your job just like someone who is self-employed? What makes then safer bets?

14 Answers

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  • 1 decade ago
    Best Answer

    Your self employed therefore you are your own security , meaning they require security of income and as self employed you don't really have that unless you have private insurance coverage that guaranties your income in cases of health ect.

    Its all about wealth and equity. If you can guarenty your income you are a good risk.

    hope that helped

    Source(s): personaly
  • 1 decade ago

    It's not that hard, you just have to go to the right places. Lending Tree has more conforming mortgage lenders.You need to find a lender that does non-conforming loans and that have Niche programs.

    Go to your Yellow Pages or online and look up mortgage brokers in your town and state. Most of their ads will tell you if they do those kinds of loans. Just give some of them a call and tell them you need a stated self-employed or full doc self employed. They will know what you're talking about. There are many lenders with many programs for the self employed.I work for a major lender and I process them all day long.

    Good Luck!

    Source(s): 8 years of mortgage experience
  • 1 decade ago

    I am a mtg broker in Fl. What the banks look at most of the time for self-employed persons is the amount of monies you have in savings or retirement accounts. They usually want to see a certain amount based on the income you say you are making, i.e if you say you make $10K a month they may want at least $60K in the bank. Having said that if you credit score is that high there are many programs that should work for you.

  • 1 decade ago

    It's hard because that income can easily be made up. With a W-2, banks know for certain what kind of money you are bringing in.

    So many people defraud the government and report that they are making more/less than they really are. Plus, bankruptcy rates are higher than ever now days and banks are really being careful. Have you tried other banks/mortgage companies? Just because one says no, doesn't mean that the others will. Good luck!

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  • 1 decade ago

    Contact me!

    Self Employees are not a problem, you just need the right lender. I actually have a product available for Commercial Loans - No Proof of Income Necessary- Stated Income - Min 660 FICO score

    Visit my website for my contact info www.bletza.com

    Source(s): www.bletza.com
  • 1 decade ago

    Well bascially yes. Although you have been gainfully self-employed for 7 years, banks and lenders do generally frown with self-employment. The reason is with regular workers they can always verify income with a paystub or a copy of direct deposit. With self employment the only thing to show your income and taxes and such is your tax returns. Not saying, it's you but it's a lot simpler to "modify" your self employement income than someone with a traditional job. My advise, dont dispair and just keep shopping around. You may also want to try countrywide.com and maybe start tyring your local credit unions. Good luck!

  • bianca
    Lv 4
    1 decade ago

    with your credit score you can get a mortgage, but you have to use no income verification program. interest rates with your credit score will be somewhere between 0.25-0.50% higher, then regular mortgage, but i don't see any other problems for you to get the mortgage. the real question is how much you can afford to pay, because with your credit score the lenders will give you any amount you want. i thing you approach this problem without any knowledge how to apply for the mortgage- you do everything right, but you don't know what are the requirements to obtain the loan .

    go talk with mortgage broker and they will guide you in the right direction.

  • autumn
    Lv 5
    1 decade ago

    the lending tree probably just doesn't want to do all the work that is involved (2+yr's of 1090's, 12+months of bank statement's...)

    Companies like the lending tree want quick in and out business...not crazy complicated loans. If you are in NJ, PA, CA, or MD, contact my old employer and they will be more then happy to help...

    www.terrafinancialgroup.com

    If your not in any of those states...just contact your local mortgage broker...they are licensed to shop around differnt companies and get you the best deal possible.

    good luck

    Source(s): former mortgage processor
  • 1 decade ago

    How about trying a loan on http://www.prosper.com

    Its a new concept of person to person lending.

    The max amount to ask for I believe is 25,000 and you may only get that if you have perfect credit. It won't hurt for you to try though and get a smaller amount. You can pay off the loan which will raise your credit and the banks may then loan to you.

  • 1 decade ago

    Its not hard at all, call me what ever your credit score I will get you the mortgage amount with a good interest rate. This is a good time to buy so hurry and give me a call JIM 703-918-0033 EXT 28. I will get it for you in one week.

    Take care

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