Obtaining loans as a business owner question/strategy advice.

[Christopher Morales]

Happy New Years!

I am a business owner and have faced some problems with obtaining some RE loans due to too many write offs and "not enough verifiable income" i have almost all my debt paid off aside from my properties and have a good credit score.

I was wondering if i had my LLC taxed as an S-corp and listed myself as an employee and collected pay checks, i am assuming it would be easier to obtain the loans as an "employee" as opposed to a business owner?

Down money is not really my concern or an issue, just trying to strategically get approved.

Feel free to give me any feedback, tips or constructive criticism as i am trying to develop this further.

Thanks everyone, have a kick *** 2012!

[Chris Martin]

Christopher, sounds like you are not convinced. A tax attorney probably doesn't know the intricacies of underwriting. People at banks might not either, depending on their position. Hey, is this a government underwritten (GSE) loan? Like you'd see at a "big box" bank, via Fannie Mae, Freddie Mac? Did you apply by filling out a form 1003? If so, the last line says "I/We fully understand that it is a Federal crime punishable by fine or imprisonment, or both, to knowingly make any false statements concerning any of the above facts as applicable under the provisions of Title 18, United States Code, Section 1001, et seq." That's where Bryan and J Scott were coming from.

If it is a GSE underwritten loan, they won't accept your W-2 anyway. It's right there on page 286. Using the 'employ yourself with your own money' technique you won't make it through DO/DU anyway, so I'm just trying to save you some time and headache:

"...borrowers who receive income from partnerships or corporations in which they have a 25% or greater ownership interest. (Such a borrower is considered self-employed. The lender must document and underwrite the loan application using the requirements for self-employed borrowers, as described in Section B3-3.3, Self-Employment Income.)"

Self employment underwriting starts on page 315. Check out the section where the lender can waive some requirements... in case they may apply to you.

reference: https://www.efanniemae.com/sf/guides/ssg/sg/pdf/sel012711.pdf