This article focuses on strategies on How To Get A Los Feliz Mortgage If You’re Self-Employed, freelancing, or an entrepreneur. How To Get A Los Feliz Mortgage If You’re Self-Employed, freelancing, or an entrepreneur in Los Angeles is a question I am often asked from my clients interested in buying Los Feliz real estate, or other eastside Los Angeles neighborhoods.
Since many of my clients interested in buying Los Feliz real estate today have multiple sources of income, verification to prove credit worthiness can be a bit more involved than just producing a tax return or a pay stub.
Either as a freelancer or as the owner of your own small business, your income can fluctuate greatly from year to year or even month-to-month. I’m in the same boat being a Los Feliz real estate agent, by the way. Our income and earnings structure can make it difficult to get approved for a mortgage, but there are some things we can do to improve our chances, and if you’re smart you’ll chat with a talented mortgage broker like Joe Tishkoff from Skyline Home Loans who happens to also be my preferred lender and has pre approved my wife and I for our mortgage loan.
Below are three helpful tips for getting a mortgage if you are self-employed.
How To Get A Los Feliz Mortgage If You’re Self-Employed, freelancing, or an entrepreneur tip #1: Make Sure Your Credit Score Is In Good Shape
While your ability to pay back a Los Feliz, C.A. mortgage is the most important factor in approval, your credit score is a close second, and that goes for every borrower, not just those who are self-employed. If you have a credit score in the high range — something above 750 or 800 — it will help you get approved for a mortgage with low rates. To boost your score, make sure you pay all bills on time, pay down your debt levels and do not make any new large purchases or apply for new credit during the loan process, or at any time before your loan is closed. Each change to your credit report is like a big red flag to a lender, so just do not do it. Joe Tishkoff is a whiz with these types of questions and he’s always willing to give his advice and feedback when necessary.
How To Get A Los Feliz Mortgage If You’re Self-Employed, freelancing, or an entrepreneur tip #2 – Have A Large Down Payment
The more money a bank lends you to buy a home, the more risk it is taking that the money won’t be paid back. Simple right? If you are self-employed and considered a higher risk to begin with, one way you can alleviate some of that risk is to be able to put down a large amount of money. Do you have a wealthy oil drilling uncle or maybe a distant cousin that left you a large sum of money? Yeah, I don’t either but it was worth asking.
Putting down 20 percent is standard for a conventional loan, and you should be willing to contribute at least that much if you’re interested in the best loan programs and most competitive interest rates. Putting at least 20 percent down also will save you money in the long run, because you won’t have to pay for mortgage insurance, and you will pay less in finance charges over the life of the loan. That’s just my two cents, however, it would be worth your weight in gold to check in with Joe Tishkoff with Skyline Home Loans. He’s the best for answering these types of questions. Joe can review other programs with 3% down programs, 3.5% FHA programs, 5% down “agency high balance” programs to $625,500 and even 15% down up to a maximum loan amount of $3MM! So, while down payment is important to the self-employed borrower, there are very viable low down payment options to discuss with your lender. But note that not all lenders offer low down payment options in higher priced areas like Los Feliz, Silver Lake, or even Echo Park.
How To Get A Los Feliz Mortgage If You’re Self-Employed, freelancing, or an entrepreneur tip #3 – Have Significant Assets
One way to put a lender at ease about your ability to pay for a mortgage is to have significant reserves in the form of assets. If you have large amounts of money in regular savings, brokerage, or retirement accounts, it demonstrates that you have reserves to tap should your income dip. Solid reserves can often times offset the need to have a large down payment or at least allow a lender to consider a smaller down payment if there are reserves held in a 401k, IRA, TSA, or investment accounts. Or, maybe your relatives would be wiling to take a small bit of a home equity line of credit to help. A gift is always a plus on many programs that allow gifted funds. Joe Tishkoff always comes up with fresh and alternative ways to help save my buyer clients money.
Whether you’ve a self-employed business owner, an Uber driver, freelancing, working in the entertainment business, have “seasonal or fluctuating” income or you’re an entrepreneur, I hope you’ve found these home buying tips on How To Get A Los Feliz Mortgage If You’re Self-Employed helpful, and you now are better prepared to work with a lender to get pre-approved to purchase your dream home soon.
Happy house hunting!
Realtor | Neighborhood Expert | Los Feliz, C.A.
I’m a local real estate agent with Sothebys International Realty and It would be my pleasure to help you find the perfect property to call home in Los Feliz CA, or if you’re thinking about selling a house, condo, or multi-family building in, Los Feliz, Silver Lake, Atwater Village, Glassell Park, Mount Washington, or Downtown Los Angeles, it would be a privilege to help you get top dollar for the sale of your property.
Lets chat sometime. 310-913-9477 or contact me.
