Portfolio Loans – Great for Self Employed

If you are self employed you more than likely use a schedule C when you file your taxes to the IRS and doing so, you write off just as much as you can so you can keep your hard-earned dollars instead of paying the money to Uncle Sam in the way of taxes. This seems like a great idea unless you are searching for a lending company so you can purchase a home. Most lending companies need to see your tax returns in order to get you qualified for a loan. It does not matter how much money you actually make in a year what is known as your gross income, the only figure that is looked at is your net income or adjusted gross income. In many cases, this figure may be your downfall when it comes to buying a new home. Some of the items on your schedule C can be added back into your income however, the majority of the items cannot be added back in such as depreciation on your automobile.

Along with needing your tax return, many lenders need to see a terrific FICO score. With the market the way it is now, self employed individuals are being to see that it is even tougher trying to get a home loan. All of the stated income loans are gone, lenders are asking for high FICO scores such as 680 and higher, and of course you have to show proof of income with your tax returns. All of this can put a dapper on self-employed people of ever reaching their dreams of home ownership.

The good news is portfolio lenders are there to help. You may have to search to find one, but they are the light at the end of the tunnel for many. A portfolio loan is really a loan program that is outside the box of most underwriting guidelines that you see with conventional loans such as FHA, Freddie Mac, and Fannie Mae.

The reason portfolio loans are better for self-employed people are that they look at the person or persons requesting the loan such as not only their credit rating, but if they pay their bills on time and if they believe, the person is worth the risk. In many cases, portfolio lenders are a group of individuals instead of a large corporation. The interest rate they offer might be a bit more than what you would find with a Fannie Mae loan but 1% over Fannie Mae is not that bad when you cannot find another loan option. In most cases, with a portfolio loan, you will to have 10% down but 5% of the amount can come as a gift. You only need to have 5% in your bank at the time of putting a bid on your dream home.

If you are in this boat like several other self-employed individuals across America, it may be time to forget the normal avenues for home loans and look for a portfolio lender.

Southern California Home Buyer’s Fair Reminder

The Southern California Home Buyers Fair is only a few weeks away Saturday, April 12, and Sunday, April 13 don’t forget to mark your calendars!!!

In an effort to support REALTORS® and educate consumers about current opportunities in today’s challenging real estate market, C.A.R., in participation with the Los Angeles Times, will present the Southern California Home Buyer’s Fair for consumers Saturday, April 12, and Sunday, April 13 at the Los Angeles Convention Center in downtown Los Angeles.

The Southern California Home Buyer’s Fair will feature more than two dozen educational seminars presented in English and Spanish for consumers, designed to address many of the concerns of first-time home buyers and arm them with all of the practical information they need to know as they begin the road to homeownership. Seminar topics range from understanding home prices and monitoring and fixing credit to applying for a mortgage and the importance of the home inspection.

In addition, the exhibit hall will feature nearly 75 exhibit booths where consumers can obtain information from industry experts about a vast range of programs pertaining to homeownership and the home-buying process.

For more information, visit www.homebuyersfair.com.

Admittance to the Southern California Home Buyer’s Fair is free, however, event coupons are available. Members may obtain coupons from their local association, or download and print for distribution to their clients directly by going to www.homebuyersfair.com/pdfs/SCHBFCoupon.pdf.