We’re not actually in the mortgage industry; we’re actually in the business of navigating underwriting and guideline minefields. If you’re a recent home buyer, a Realtor, a title company professional or a fellow lender you’ll understand that I am not being overly dramatic! We tread cautiously with an eye for what’s ahead…that’s just the name of today’s game.
Today’s borrowers are different too. A larger percentage carries heavier baggage and less than stellar credit scores. Some borrowers, (more than you would think) are not even packing a W-2 – the standard statement for yearly income reporting. Certainly the economy and subsequent job losses have compelled many “ex-employees” to become business owners. And while being self-employed has tremendous benefits; you need to follow different qualification rules when buying a home. One of them involves getting “permission” from your CPA.
Basically, if you plan on taking money from your business and putting it toward buying your home, your CPA needs to provide a statement attesting to the fact that the amount you are “withdrawing” will not materially affect your business going forward. (Personally, if your CPA has that brand of crystal ball I have a lottery card I’d like her to fill out…)
At the end of the day, I just enforce the rules; I don’t make ‘em. If you own your own business just be prepared for some less-than traditional means of showing your mortgage-ability!