Self employed - mortgage loan. Need advice (approval, credit score, bank) - Mortgages -Lenders, loans, financing, rates, foreclosures, short-sales, brokers, credit score, deed, lien, refinancing, borrowers - City-Data Forum

melvincfl · 06-06-2012, 03:37 PM

My wife and I want to buy a vacation home here in Florida.
We have been self employed for 14 years and our credit scores are excellent.

Everything comes out good in the initial approval in the bank because they are using our total income. The problem is that we run 3 online businesses and put most of our effort into the business where our work currently pays off best.

This means the profit for each business will fluctuate. One year business A will be most profitable and next year maybe it will be business B and so on.

So now the bank see that profit from business A and B have increased from 2010 to 2011, but profit from business C has declined. Because of that they are removing ALL income from business C and calculate our average yearly income from A & B only. This kills the deal for us even though our total profit from all 3 businesses has increased.

Is there any bank who will look at our actual total income so we can be approved? Any suggestions to how we can overcome this problem?

Debsi · 06-07-2012, 07:06 AM

How much did you make on Business C? How much had it decreased?

melvincfl · 06-07-2012, 07:36 AM

Business C went from $70k to $40k. Business A went up more than that because that was where our main effort was last year. I can already now see that it will reverse again this year. Business C will go up and A&B down.

I'll never be able to get a mortgage if they keep looking at the individual businesses instead of the total.

Debsi · 06-07-2012, 07:41 AM

I think you may be able to find another underwriter (somewhere else) that doesn't cut the income so strictly. You could also try offering up prior years of tax returns if they will show a consistency of income.

Tekzilla · 06-08-2012, 07:36 AM

How in the world do you and your wife run 3 businesses at the same time for a profit?

melvincfl · 06-08-2012, 11:25 AM

Quote:

Originally Posted by Tekzilla

How in the world do you and your wife run 3 businesses at the same time for a profit?

I never think of it as 3 businesses in my daily work. The work I do for each business is similar, just for different areas of the same deal. Unfortunately there is a few practical reasons that require us to keep it split in 3.