Self-Employed Buyers: Things to Consider for Your Mortgage Application

Self-Employed Buyers: Things to Consider for Your Mortgage Application

Mortgage qualification years ago required minimal paperwork for self-employed buyers. Any buyer, especially self-employed buyers with an average credit score and a social security number could qualify for financing without income documentation. But things changed after the mortgage meltdown and housing crash that started in 2008.

Now lenders are a bit more cautious about approving home buyers. Instead of putting a stamp of approval on every mortgage application, lenders want to see that buyers have the ability to meet the payments each month. When mortgage reform was passed in 2010, lenders started requiring that borrowers provide full documentation for both assets and income.

Qualifying for a Mortgage as a Self-Employed Buyers

These changes in the mortgage industry made it harder for self-employed buyers to qualify for lending. W2 earners qualify for mortgages by showing the gross earned income on the tax documents. On the other hand, self-employed borrowers need to qualify by showing the net income on the tax returns.

The problem is that most self-employed people maximize the write-offs and itemized deductions, helping to minimize the tax burden by showing a low net income on the paperwork. This strategy is beneficial to save money on taxes, but self-employed buyers find it hard to qualify for a home mortgage now.

Creative Mortgage Options for Self Employment

Just because you are self-employed, doesn’t mean that you won’t qualify for a loan. Instead, you need to be sure that you are working with a lender that uses creative approval options. For example, some lenders use approval programs that depend on bank statements instead of tax returns. A business owner can show 12 – 24 months of bank statements to prove qualifying income for the mortgage approval process. The lender calculates the qualifying income based on the average monthly deposits that move through the account.

This calculation is done by totaling the deposits into the account based on the information on the bank statements. As a general rule of thumb, 50% of the deposits into a business account will be calculated to determine the monthly income.

Other mortgage options might also be available depending on the circumstances: FHA loans, VA loans, USDA loans, and more.

Requirements for Self-Employed Buyer Mortgage Approval

In addition to the bank statement income verification, a few other requirements are essential for mortgage approval. Self-employed buyers need to provide:

  • Proof of at least 2 years of self-employment (can be verified through a letter from your accountant)
  • A business listing
  • Your business website URL
  • Good credit score
  • Down payment
  • Asset documentation

Additionally, any co-borrowers who earn W2 wages will need to provide the income documentation as well.

There are pros and cons to creative lending for self-employed buyers. You shouldn’t overlook your options if you are ready to buy a home. The right real estate agent and lender will help you identify the solutions to meet the needs of your family.

What are your questions about the home buying process? If you would like more information, then you can talk to our experienced team at DUFFY Realty: (678) 318-1700

Here is another great post for you to read is about safe comfortable housing on your site.  


The Kitchen: The New Family Room

The Kitchen: The New Family Room

One of the benefits of shopping for a new home is that you have the opportunity to pick the perfect space that will best suit you and your family. The home is a sanctuary for your children, creating an environment where they can learn and grow. It is important that you are proactive to consider the type of home that will be best suited for your family.

Where do you spend most of the time when you are at home? Most people find that the family naturally gathers in the kitchen and dining room. The kitchen tends to be the “magnet” of the home, and many people even consider this space the heart of the home.

Family Time around the Dinner Table

A comfortable dining room is important, but a nice kitchen is even more important. When you have the space to prepare healthy meals and gather the family around the dinner table, you will have more opportunities to build long-lasting memories and family unity with your kids.

Kids remember the small daily experiences and the kitchen are often central to these memories:

  • Sitting up at the counter to enjoy warm cookies and milk
  • Learning how to bake pancakes with mom on Sunday morning
  • Sharing their favorite meal around the table during the holiday season
  • Blowing out the candles on a birthday cake
  • Decorating sugar cookies to take to the neighbors

All of these memories are the things that make childhood sweet, which is why it is so important to view the kitchen as the new family room of the home. This space is also often used for homework, crafts, board games, and other family activities throughout the year.

Finding the Right Kitchen for Your Family

While you are shopping for a new home for your family, it is important to consider the layout of the home. Also, look at the way the kitchen is built to be sure that you will have the space needed to support the care of your family. Consider the arrangement of the cupboards, the placement of the appliances, and the locations where family members will be able to sit during meal times and family gatherings.

These details matter especially because they will impact the comfort of everyone that comes. Buying a home with a kitchen that you love will improve your satisfaction and happiness when you are spending time at home with your family.

Don’t Sacrifice the Quality of Your Kitchen

When you are looking at home listings, there is no reason that you should sacrifice the quality of your kitchen. An experienced real estate agent can help you find a home that matches your requirements. You will love the feeling of enjoying the new kitchen with people that are dear to you!

For more information about finding the right home for your family, contact Duffy Realty of Atlanta at (678) 318-1700

Atlanta Real Estate Tip: Don’t Be the Carnie Rube!

Changing the Atlanta Real Estate Industry In any industry, it is common for businesses and customers to get stuck in the same pattern of buying and selling, and it can completely disrupt the industry when an innovative idea is offered in the market. “Carnie Rube” was a term that was coined in the 19th century, and this slang phrase was commonly used in the United States among carnival workers (“carnies”). The term “rube” was known as an idiot, and if a person was called a rube then it meant that they were easily scammed or fooled.

Flipping the Industry Upside Down

There are many examples throughout history where Carnie Rubes are fooled in their purchases, because the businesses are focused more on profits instead of the value and service offered to the customers. People continue spending too much money without knowing that there are other options, until a company comes in and changes the way things are done. Dollar Shave Club is the perfect example of how one business can completely transform an industry. For many years, customers spent too much money on low quality razors, and then Dollar Shave Club came in to show us something better. Dollar Shave Club changed the norm of purchasing razors, making competitors scramble to keep up with the changing trends in the industry.

Carnie Rubes in the Real Estate Industry

Unfortunately, the real estate industry is one area where people are often scammed, because many people are stuck in the old-fashioned way of thinking. The real estate industry has been around for a long time, and agents have maintained the same high commissions even though the market and approach has drastically changed over the years. Is your real estate agent getting a high percent commission when you sell or buy a home? Then, you have the label of Carnie Rube pasted right across your forehead! Many home buyers and sellers waste thousands of dollars in real estate transaction fees because they don’t know that any other options are available.

Like the changes that happened in the razor industry because of Dollar Shave Club, Duffy Realty of Atlanta has flipped the real estate market on its head. We have found a different way to buy and sell homes, and we know that you don’t have to spend thousands of dollars in real estate commissions. By offering flat-fee listings, the market in Atlanta has complete transformed… allowing us to become the leading real estate company in Atlanta and the surrounding areas.

Don’t be a Carnie Rube by listening to the other real estate agents who are telling you that it will cost thousands of dollars to sell your home! Some real estate agents will even fool you into thinking that they won’t show your property if listed by Duffy. But, their real interest is to steal your listing so that they can make more money for themselves. Let Duffy Realty of Atlanta show you how it should be done. Contact our office today, and you will have the peace of mind to know that you are working with a real estate agent who has your best interests in mind: (678) 318-1700

You Are A Sole Proprietor: How About A Solo 401(k)

I am seeing more and more people quit the corporate America lifestyle and venture into becoming their own business owner.  This shape of a business owner can be a freelancer, consultant, or someone who actually starts up a ‘brick and mortar’ operation.    Many of these folks will ask questions about whether they should incorporate their business, which I have discussed in other articles.    Once they become profitable, they often ask which kind of retirement plan would suit them the best.   For someone who is a sole business owner, the Solo 401(k) has been around for about a decade and provides a great alternative to helping maximize your retirement contributions.   Here’s a little history on the Solo 401(k) and how it can be a smart money move for your business. The Solo 401k came about in 2002 after Congress passed Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA). EGTRRA added some small paragraphs to the tax code that put forward the solo 401(k) as the preferred retirement vehicle for…

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How To Get Rich with oXYGen Financial – 08/27/13

Taped 8/27/13 Listen every Tuesday morning at 8:00 a.m. on ROCK 100.5 | Atlanta’s Rock Station to “Your Smart Money Moves” with The Regular Guys and oXYGen Financial. Ted Jenkin, CFP® and Kile Lewis, CRPC® are the founders of oXYGen Financial, and our chief financial officers. All your money questions answered Breathe easier at

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AMEX Points: Try The Clearance Rack

People often ask me what is the best type of credit card to get when it comes to frequent flier or cash back awards. I’ll cover some of my favorite reward cards in other post, but in today’s blog I thought I would share how to make the most of your AMEX card.   Sad to say, but most people who carry the GOLD or PLATINUM card don’t ever look at or use most of the benefits of card.   What most consumers are aware of is that with each purchase they rack up 1 point for every dollar they spend.   So how do you make the most of your rewards?  Check the CLEARANCE rack.  Here’s an example of three items you can get in the clearance section on AMEX membership rewards today. (source: When you click the membership rewards link in your AMEX account, you’ll notice on the far right hand side a link called ‘specials’.  If you click this link it will take you to all of the merchandise…

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Public School Is Not A Free Ride

By: Genna Jenkin The Your Smart Money Moves Mom Request a FREE consultation: Barely a week into our back to school routine and I’m already aware of some very disconcerting patterns forming.  The kids’ interest in helping get their lunches together is waning, bedtimes are not being adhered to and I’ve badgered them all about their homework more times than I’d like to count.  However, the most troublesome of all, is that every evening I find myself with my checkbook “paying” for my children’s public school education. Now don’t get me wrong, I understand that public education in this country can tend to get the proverbial short end of the stick, so I am well aware for the need to ask parents for some financial assistance.  It’s the changes I’ve seen since I enrolled my oldest in kindergarten (12 years ago) that concern me.  I’m sure that everyone with school age children can identify with the lengthy and detailed list of school supplies that every child is responsible to…

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How To Get Rich with oXYGen Financial – 08/20/13

Taped 8/20/13 Listen every Tuesday morning at 8:00 a.m. on ROCK 100.5 | Atlanta’s Rock Station to “Your Smart Money Moves” with The Regular Guys and oXYGen Financial. Ted Jenkin, CFP® and Kile Lewis, CRPC® are the founders of oXYGen Financial, and our chief financial officers. All your money questions answered Breathe easier at

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Is an SBA Loan right for my business?

Small business owners who are looking to grow their business through the purchase of a building, the purchase of equipment, the opening of an additional location or the acquisition of another business, are all faced with several questions; one of the first being, “Where will I get the capital for this project?”  Depending on the how long a business has been operating, how successful the business has been and the financial strength of the business owners there may be an overwhelming amount of options or an extremely  short list.  One of the options that is on most small business owners lists for financing no matter how long or short the list is SBA. The U.S. Small Business Administration is a federal agency committed to helping small businesses grow. One of the ways it does this is by guaranteeing loans to small businesses made through lending partners across the country.   The SBA does not make loans directly to small businesses. Instead, the SBA sets guidelines for the loans that are made…

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All I Want For Back To School Is My Trapper Keeper

It’s officially back-to-school time in the state of Georgia which means polishing up the old routine of making lunches, doing homework, and the frantic mornings of getting everyone on the bus or into the carpool on time.    It is also that time of the year where you are going to begin stocking up on school supplies if you haven’t it done so already.  All I can remember from my childhood and teen years was my mom taking me to the local K-Mart to pick up a few Bic pens, some No. 2 Ticonderoga pencils, and my color coded Trapper Keeper to organize my classes.   Nowadays we’ve got an entirely different routine with school systems providing lists instructing us to practically buy an entire shopping cart of school supplies. This year, my two middle school children have lists both in excess of thirty items that were ‘necessary’ for them to get.   It seems every year the list gets larger and larger.  So what can you do to save money when it…

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