Mortgages For The Self Employed
To structure and arrange mortgages for self employed individuals, requires a thorough understanding of the various ways self employed people can have their businesses arranged in addition to the mortgage products and options available to them. Maury is an Accredited Mortgage Professional (AMP) and can work with you to ensure that your mortgage is optimized for both you and your business.
*Update: April 2010, Changes to the self employed mortgage program
- Minimum down payment = 10%
- Income needs to be “reasonable” for industry and experience
- Self employed people can buy with 5% down payment if their income can be confirmed and qualifies for the amount requested
- Some equity based programs are available for additional options and flexibility
Self employed individuals have a unique set of needs when searching for mortgage financing based how their employment is different from the more standardized salaried employment scenarios. Banks and insurance companies have designed and structured specific mortgage products to suit the needs of self employed individuals and business owners. One of the most accommodating features of mortgages designed for self employed individuals is that a home can be purchased with a down payment as low as 5% of the purchase price (provided qualifications are met). This feature allows business owners to keep more of their money available for their business and not tied up in the property where it can not be accessed and used to run and further grow their business.
In terms of self employment, banks typically like to see two years or more of self employment in the same industry. Some exceptions can be made if there was a transition from within the same line of work prior to being self employed. The key here will be to demonstrate there will be stability and security despite a shorter time frame of self employment.
If you are self employed and would like to discuss all of your mortgage options, contact Maury today.
