How to Qualify for higher loan amount as a business owner?
Hey guys,
So I own my own business, and last year I purchased my first home and investment property (a duplex). It was a little tricky getting a loan as I own my own business and I pay myself periodically, about $100k/ year total. I think because there wasn't a consistent income, the underwriters didn't loan me much, ended up getting $300k which isn't much for southern california.
I've done much better this year, earned over $300k this past year, so I setup payroll to pay myself $100k as a consistent salary. Plus I can claim earned income from the business.
The drawback of paying myself a salary is that I can't write that income off and will pay more taxes, but will it be worth it when I get preapproved for a loan?
I guess my question really is, for a guy in my position, what is the best thing to do to get more loans? Ideally looking to buy deals for around $500 - $600k
Thanks in advance!