I think what we have to do is put ourselves on W2 payroll for 3 months to prove our income, buy the house, and then take ourselves off to save that 10% payroll tax. That’s the only solution I’ve come up with so far.

So here is my comment & question: Good ideas for solutions – but we’re talking about a mindset change for the entire banking industry – what do guys like us do in the here and now?

Could you please send me the complete details to the type of program you are seeking and the details to the property when time permits.

Joseph V. Scorese

MAC Investment Company, LLC.

joe@reiaofnyc.com

Main Office – 484-221-9277

Direct – 610-351-9927

Fax – 610-351-0903

(on both your comment and on getting to the next ignite.)

the system is so screwed up against entrepreneurs and self-employed people. like with teachers being able to afford homes, there should be special scrutiny given to self-employed people for things like loans to prove we could afford the payments. the same goes for incentives for starting businesses or being self-employed in the first place. since businesses are the ones who hire the employees who become the rank and file, they’re a huge part of the employment solution vs. being part of the problem. i’m not even going to get myself going with that one…

but yea, totally agree that that’s not how it should be, and i’d be the first one on the boat to trying to make it all right.

hopefully see you at the next ignite!

Thanks for the info. Yea, I did skip the part you mentioned about the potential where the W-2 employee screwed over their credit history, but that’s a completely different issue to some degree. If they still had the money to put forward, however they receive it (at their job or via an inheritance or whatever), they’d still have a better chance at getting a loan than I would.

The problem isn’t my history at all. I’ve been doing this for 15 years, full time for over 10 of those years and it’s been extremely stable over the long term – moreso than my employment history if they cared to look at the difference. The problem is that I can’t prove that to anyone in the ways they want it proven. The problem I’m pointing out is that the methods to prove that you are able to afford something are messed up. You could say that stated income loans were too relaxed. I’d just say unregulated.

I’m not one for more regulation, but at least defining some kind of middle ground here is what’s missing.

If it were simply showing a 2 year history of steady income, I don’t think I’d have this problem at all. The loan officer I talked to did mention a 2 year history, but it was with 1040′s. That’s where the problem lies. On the 1040′s I don’t make jack squat. But we all know that’s not truly the case. I take as many tax deductions as possible to keep my taxable income low. The problem is that they’re looking at my taxable income – the very thing I’m trying to keep low so I don’t have to pay much in taxes is the thing they’re looking at as “enough” income. There’s the problem right there. You can’t pay less taxes AND show that you make enough money to support a loan simply because the lenders won’t look at the true amount of money you have to spend on housing (even though we pay that amount in rent every month with no problem).

I fully understand it’s the “reality of the situation”… I’m just calling it out as not being how it should be.

p.s. I appreciate the offer, but I think we’re just going to be sitting tight for now unless we do find a bank who will lend to us.

Cheers friend.

Dsafeer

1. the w2 employee won’t get the loan even with full docs if he defaulted the first time because their credit is shot. if they were lucky enough to sell the house in a short sale, then they would fit the situation you described and could buy another house.

2. unfortunately for us entrepreneurs and self-employed people, the reason why we wouldn’t qualify for the loan is because the income is unpredictable. if a venture or contract ran out, then there would theoretically be no income left to make the loan, despite having plenty to make the rent. unfortunately, we can’t show at least a 2 year history of steady income paired with our otherwise immaculate credit, and that’s a big reason for why we wouldn’t qualify for the loan. that’s what is important here, not the rental history.

we’re just dollars and cents to the bigwigs and fatcats and they’re not taking any chances. as far as they’re concerned, we’re just like everybody else. it doesn’t matter that you or i or anybody else are upstanding, morally and financially responsible citizens because they don’t know who we are. they see that we haven’t had that steady job and therefore pose a riskier bet than joe shmoe who makes $45k/year and has been at his job for 2 years.

it sucks, but that is unfortunately the reality of the situation. if you can afford to put at least 20% down, have a great credit score, and show a reasonable combined income over the last 2 years, then you will make a much more compelling argument for them to give you the loan. good luck and i hope you can lock it down and get the condo!

ps. i moonlight for a broker as an agent and, if you want, can find out if there’s anything they can do to help. holla!