Refinance Home Loan Issues for Self-Employed Borrowers

May 20th, 2009

The subprime home mortgage lending industry encouraged the use of “stated income” loans for self-employed individuals for the better part of the past decade.  With the meltdown and eventual shutdown of these same subprime lenders came the end of stated income home loans for all intent and purposes. 

 

Now, a refinancing homeowner has to fully document their income, which is not a problem for those that are “W2” type employees, but a much more difficult task for those that are self-employed.  Those working for themselves will be required to submit their previous two-years worth of full tax returns for refinance home loan qualification purposes.  The “usable” income with be the business income shown, after all expense deductions, which can create an eligibility problem for self-employed individuals.

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Entry Filed under: Business

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