Being self-employed can be quite a decision, as it affects many aspects of your life. While it can give you a chance to be your own boss and make your own schedule, there are some aspects that you need to keep in mind, such as your own health insurance, retirement, and life insurance.
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Can You Get a Mortgage While Self-Employed?
Some people feel confident about getting a mortgage even when self-employed. While it can be stressful, and you may not know who to turn to for help, it’s still ideal to get in touch with a professional and figure out what can work best for you.
There are some ways that you can get a mortgage when self-employed, and they can all be made possible with the right loan. Plenty of mortgage loans have fixed terms and requirements, so it’s ideal to find one that’s a little more flexible.
What Should Help with Getting a Mortgage?
While figuring out how to get a mortgage can be challenging for self-employed people, it’s best to note that there are plenty of things you can keep in mind to make the application process easier. Here’s what you need for your mortgage when self-employed:
Good Credit Score. There are many reasons you need a good credit score, and it will be necessary to help you get a mortgage. While it may be difficult to go from great to poor credit in a short amount of time, you can slowly work on it.
Clean Records. Debt and a questionable credit report can affect your mortgage application. In contrast, having a clean record can help you get approved for a mortgage and give you the chance to create a good reputation with potential lenders.
Cash Reserves. When you’re self-employed, you should have a stable income and cash reserves to make you a worthy borrower. Your loan will depend on the earnings that you have, so it’s better to have a steady amount of income coming in.
Large Down Payment. If possible, having a large down payment can be beneficial in helping you get a mortgage. It’s still necessary to pay off the rest with your monthly mortgage payments, but you can plan ahead on saving up more money after that.
Documentation. It’s better to have plenty of documentation that you can use to support your mortgage application. Always remember to organize everything as much as possible to ensure you’re ready for anything.
What Are the Downsides of a Mortgage While Self-Employed?
Mortgage payments can be hard to keep up with, depending on the terms. When you’re self-employed, there can be changes in your earnings at any time. This means you never know when you will earn a bit more or less. It’s best to ensure that you’re in a viable financial situation to make your mortgage payments on time.
What Are the Advantages of a Mortgage While Self-Employed?
There are plenty of different options for mortgages when self-employed. You may need to take a look at a few different things to figure out what will work for you in the best way possible. As long as you speak with a considerate mortgage professional and negotiate a flexible loan that works for you, you can become independent and get your dream home.
Your Experts at Mortgages by Misty
Getting a mortgage while self-employed involves a few steps so to make it happen, it’s best to learn more about the mortgage process and determine how to get a mortgage while self-employed.
Looking for mortgage loans in Arizona? Mortgages by Misty offers flexible mortgages for Tempe, AZ, so you can experience beautiful neighborhoods, sunny weather, excellent schools, and a booming job market. Get in touch with us today at (480) 618-5358!
Do you know how much home you can afford?
Most people don’t... Find out in 10 minutes.
Today's Mortgage Rates