At Lendova, we deal with a range of customers who hail from different backgrounds. Our staff must help all our customers, whether they are salaried or self-employed. A large number of potential buyers, especially self-employed borrowers, describe the mortgage process as an intimidating experience. Lendova has heard your complaints and wants to help you out!
Do not give up on the dream of becoming a homeowner if you are self-employed. At Lendova, we provide custom-tailored consultancy so that every individual can become a homeowner. Our staff’s job is to remove obstacles from your mortgage process and make it easier for you to get approved.
Our Digital Application Provides a Quicker Process
Lendova offers a safe and secure online application process to ensure its customers have a simple mortgage experience. We uphold the standards of digital security for everyone and want to ensure that all our customers go through the same process. Our secure digital application is heavily encrypted and protects our customers’ data at all costs.
Unlike traditional lenders, Lendova aims to be as efficient as possible by avoiding any paperwork irrelevant to your approval. Depending on the information inputted in your application, we will be able to request all the pertinent documentation quickly our underwriters will need to approve your loan.
By understanding what to expect throughout the mortgage process, you can make things a lot easier on yourself. Below you’ll find some pointers that will help you along the way.
Documents Required for Income Verification
Lendova will verify your self-employment history to determine whether you qualify for a loan or not. They do so by requesting two-years of your tax returns to document consistent and stable income. If you own 25% or more of any business, guidelines state that we will need to classify you as a self-employed borrower. As a result of this, we will ask for two years of business tax returns for each business you own.
Customer’s Affordability is Our Priority
Lendova’s method to calculate your income is relatively simple. Self-employed borrowers don’t have the advantage of receiving a regular annual salary and their income, unfortunately, fluctuates year over year. We will use a conservative approach to properly qualify you for a mortgage even if your income becomes volatile. Over two years, if your income has significantly increased, we are required to use the average of the most recent two years. If a decrease has taken place in your net income over two years, we will use the lower value of the most recent two years.
Scenario 1: XYZ company is reporting $75,000 in net income for the year 2017 and $88,000 in net income for 2018. Therefore, our underwriter will use your average salary over the last two years. In this scenario, the average income is $81,500 per year or $6,792 per month.
Scenario 2: QST company is reporting $80,000 in net income for the year 2017 and $62,000 in net income for 2018. As a result, our underwriters will use the $62,000 per year for decision-making purposes, or $5,167 per month.
Make Sure that your Down Payment is Coming from Eligible Assets
The toughest step in the application process is verifying funds that will be used for your down payment and closing costs. We recommend our self-employed borrowers to keep their funds and business funds in separate accounts to ensure their businesses are not adversely affected. If business assets are used, we will need to evaluate if this will be detrimental to your business during the underwriting process.
It is your call to decide which funds you want to use for the down payment, and it is our job to help you determine which funds are eligible to be used. Whichever account you choose to use, we will need to see two most recent months of bank statements for the respective account, whether it be a personal or business account.
Lendova strongly believes that self-employed individuals should not be prevented from securing a mortgage. Please call us today so that we can provide you with a custom-tailored solution or please visit our website at www.lendova.com.