Many people are more into freelancing careers because of the ample benefits found. Nowadays, bank statement mortgages are even taking over the traditional home loans. Such mortgage options are available to the self-employed people who can verify their income without being a regular employee. When you lead a conventional career, you can submit the pay stubs to the lender. However, bank statement loans are widely used by entrepreneurs.
During this period of gig ceremony, millions of Americans are interested in becoming self-employed. For this very reason, the lenders provide bank statement loans that are better alternatives to shape your dream into reality. Even though you lack regular employment, it should not rob you of your dream, right? Contractors, business owners, gig workers, and freelancers can opt for bank statement home loans in Houston. Needless to say, people out there with non-traditional income can easily get a bank statement mortgage. Of course, they need to remember a couple of things. Go through the rest of the article to know how the mortgage works.
Know who can Reap Benefit from the Loan
Borrowers who do not have consistent flow can opt for bank statement home loans. The freelancers or consultants cannot submit particular income documents; hence, the mortgage is an ideal option for them. Even if you fail here, you cannot get verified for an FHA or conventional loan. For such mortgages, the tax returns or income proofs are inaccessible. At this time, write-offs are alternatives; however, the real income is not revealed. The bank statements can tell a different story and the self-employed people can get qualified easily. In addition to the context, the present homeowners can utilize the bank statement mortgage for refinancing the existing loan.
Understanding the Bank Statement Home Loan
Besides the freelancers and contractors, the workers with seasonal income can apply for the mortgage. Another benefit of the bank statement loan is that there are no tax returns or W-2s needed. In addition to the context, you need not submit the pay stubs either. There are high loan limits. Also, high debt-to-income is allowed. You can apply for a second home, primary residence, and investment property. However, you should remember that the mortgage comes with high-interest rates. There are down payments are needed too. You need to look for a private lender before applying for a bank statement mortgage.
Analyzing the Bank Statement Mortgage
If you are going to purchase or refinance a home, you should know particular things. At first, you need to document your income. It includes savings, debts, retirement, and investment balances. This process can be a little challenging for self-employed applicants. For example, a freelancer might be working $7,000 per month. After getting through the write-offs, the taxable income might be around $5,000 per month.
So, are you a self-employed person or a seasonal worker? It does not matter whether you are a professional without a regular income stream or promoter, the bank statement home loan can provide you plenty of benefits. To get the rates and know the down payment requirements, you can seek help from a lender.
Author Bio: Joan Gallardo, a Senior Loan Officer, with 20+ years of experience, here writes on 2 questions to ask the best mortgage lender in Houston when you are about to choose one of the first time home buyer programs in Houston.