Experience with Self-Employed Mortgage loans??

Question

Within the last couple of days, my conventional terms have fallen out and I am unable to qualify due to the amount of points. However, I have two options, DSCR which makes this deal very tight ($100-150 cash flow each month) or a Self-Employed Loan. I have ZERO experience with this product, can someone with experience help me out please? If so, where is the best place to obtain one? I am a business owner and would have plenty of income to qualify!

Eliott Elias · Answer

How about owner finance?

Doug Smith · Answer

By self-employment loan, I assume you mean a loan through a bank or other lender that reviews your income from your business. What type of property are you financing? Your personal residence? An investment single-family home? An industrial property? What is your credit score? How do you file your business taxes (1120-S, 1120, on the Schedule C of your Personal Return, etc). What is the property worth? What do you owe or is this purchase? I need to know more to give you solid guidance. I was a bank commercial lender for years, but that is different from how we're structured now. Banks are great at some things and lenders like us are great at other things. I simply want to guide you in the right direction.

Jon Puente · Answer

Hey Colby,

I am very curious why the amount of points all of a sudden made you disqualify for a Conventional loan?  I am assuming this is for an investment property?

If you are wanting a Bank Statement loan to purchase a property (which is what S/E borrowers use), then you need to have 680+ credit score and at the very least 15% down payment.  It's an entirely different world than the traditional financing.

Great Question!