Mortgages for the Self-Employed

When someone is self-employed, it may be difficult to show income, as a lot of the income that they recive in written off.

Here are some options for the self-employed borrowers that are available:

1. Fully Qualified Self-Employed Application

As income fulcates for a self-employed individual, this application involves taking the last two years NOA, and using that number as the qualifying income. Many lenders will either offer a 15% gross up of the income, or allow add-backs for things like car expenses. Recently, National Bank in an effor to get away from Stated Income (Discussed Below) is offering a fully qualified application that allows a 75% TDS. This means that 75% of your income can be used towards debt payments. A fully qualfied self-employed application has the ability to qualify for a downpayment as low as 5%.

2. Stated Income for Self-Employed Applications

Basically for this type of application, the borrower is required to state or give an approxmeite idea of their income situation. The amount must be reasonable. A higher than normal credit score is required, and a mimium of two years as a self-employed employee is required. It is only permissable to put no less than !0% down on a property that is being purchased. It is possible to be able to qualify for a loan sooner, if you become self-employed in an industry that you were already working in.

Without question this is perhaps one of the most common scenriors that you must use a mortgage professional.

Things You Didn't Know Your Mortgage Could Do

When we think of a mortgage, there are several things that come to mind. What is the interest rate? How long is the term? How much will my payments be? But, did you know that lenders are adding new perks to mortgages all the time? Here are some great features that lenders are offering:

1. Cash back Mortgages

Most lenders offer some variation of this program. Basically, this program means that a lender will give you cash back at the closing to be used for things like closing costs, furniture, renovation costs, and even the down payment. The amount that a lender will offer with this program varies from 3% to 8%. However, the program isn't all roses as usually lenders will charge a higher interest rate on the mortgage.

2. Warranty Insurance

There are a few lenders that are offering free home warranty on things on your house if something goes wrong in your first year of home ownership.

3. Green Mortgages

With a move towards more eco-friendly products, mortgages are no different. Usually, the approach is that once the house is completed with eco-friendly renovations, there is cash back given to the borrower.

4. Portability

A lot of people worry about what happens if they decide to move and change houses. They may even avoid moving in an effort to not have to pay the enormous mortgage penalty. Portability allows you to move your mortgage over to a new property with the same rate and terms.

Just like any other type of product on the market, there are plenty of mortgage products to choose from and compare. Make sure to contact a mortgage professional to make sure you get the best "perks" possible on your mortgage.

Behind on Your Mortgage Payments?

Let's face it, times are tough. Sometimes you may find yourself unable to meet your financial obligations. If this happens, its' important to be proactive, so you will be able to avoid losing your home and damage to your credit.

Here's are some vital steps you need to take.

1. Evaluate Your Commitment

Before anything else you need to be honest if you can afford your mortgage payment should times change, you will need to closely follow the following steps, but if you decide you have gotten yourself in a situation where you are too overlevarged. You will need to list your home for sale immediately. Even if you are unable to make any payments at all, the foreclosure process will take a long-time to complete, so you have some time to be aggressive and sell the house quickly, while having the least long-term repercussions.

2. Talk to your lender

No matter what your situation is talk to your lender and explain it. The longer that you leave the payments unpaid without talking to the lender the harder it will be for them to make a payment arrangement. Let them know when you expect to be back at work or when you expect for you situation to change. Any missed payments will be required to be made up over a short period of time to bring you back current. Some lenders have a capitalization program that can be used to skip your payments. The payments are added to the end of your term. Make sure that any payment arrangement that you make is realistic and that you follow it exactly how its agreed upon.

If you are falling behind, time is off the essence and your lender will be more inclined to help if you are honest and timely in dealing with it.