Six months ago, I started my own company. My current (and only) lender that I’ve shopped with cannot see this substantial income (guaranteed payment, not profit) as income at all since it is less than two years. They are unwilling to work with me unless I put a much higher, but undisclosed, down payment because they only recognize my spouse’s income.
My company is in a growing sector, I have a contract in my operating agreement that provides my guaranteed payment (my income), I have a ten-year contract with a single well-established $100M+ company to provide services at a rate that covers my guaranteed payment, and I have personal references from extremely wealthy people. Before you ask, yes I could borrow and/or work something out with those people, I would just rather not.
Anyone know of any banks that work with someone in my situation? NFCU wouldn’t even provide a number that I needed to get to in order to see if my spouse’s income qualified at X% down payment.
I’m assuming I’m waiting another two years before I can show two years of income statements, but maybe there’s another option I’m not finding.
Assuming excellent credit and a large down payment, you may find a no-doc/non-QM/bank statement loan, but the rates/terms will be significantly worse than a conventional loan.
Ziv said:
Assuming excellent credit and a large down payment, you may find a no-doc/non-QM/bank statement loan, but the rates/terms will be significantly worse than a conventional loan.
My credit is excellent. I was planning on 20% but I can do 40% down if I liquidate some assets. I think I’m just salty that they wouldn’t work with me to tell me what they required they just told me to give them a number that I could put down for them to run it. Figured it was their job to let me know what was necessary to qualify.
@Lennox
Sounds like they didn’t quite know what they were doing or were severely limited by the software they were using. It may be worth looking into what your wife can qualify for on her own income and solo credit.
@Ziv
Her credit is great and her income is good. We just have a lot of expenses, and her DTI alone without my income is quite unfavorable if not in the red unless we sell this property first, which comes with other potential issues. Just a heck of a predicament. Thanks for the info.
No one is going to use merely 6 months of self-employed income to qualify you, especially since you don’t even have 1 tax return with this income along with a Schedule C.
With all this guaranteed income, you should have quite a bit saved up, and you could qualify for a bank statement-only loan. It’ll be higher down and higher interest rate, but you can refinance once you have 2 tax returns with the self-employed income.
@Huxley
I understand. I was hoping, rather maybe wishing, that legally binding contracts with established companies showing contractual income would be enough. Guess I’m just wishing for the old days where you could go and have a conversation and show your portfolio and such to a loan officer.