Los Angeles California Self Employed Mortgage Lenders No Tax Returns Needed

CALIFORNIA SELF EMPLOYED-BANK STATEMENT MORTGAGE LENDERS

SELF EMPLOYED-BANK STATEMENT MORTGAGE LENDERS- NO TAX RETURNS!
Self Employed California Mortgage Lenders Questions And Answers

If you’re one of the millions self-employed Los Angeles California workers in California it is easier than ever to get approved if you have sufficient credit and can prove the ability to make the payments for a California mortgage loan. Fannie Mae has relaxed some of their guidelines for documenting income for the self-employed. Here are several tips to help you get a self-employed mortgage loan with bank statement programs being offered by today’s lenders. 

Los Angeles California Bank Statement Only (Personal or Business) Bank Statements

  • No Tax Returns No Tax Returns Or Tax Transcripts Needed
  • 12 Month Bank Statements Now Available
  • 24 Months Bank Statements (Personal Or Business)
  • California Jumbo Bank Statment Loans Up To $5 million
  • (Min Bank Statment Only California Loan Amount $100,000)
  • Credit Scores Down To 600
  • Rates Starting In The Low 5’s
  • Personal + Business+ W2 Income Or Mixed Deposits OK!
  • DTI up to 50% Considered!
  • Owner-Occupied, 2nd Homes, Investment Properties
  • Foreclosure, Short-Sale, BK, DIL – OK!!
  • Non-Warrantable Condos – OK!
  • 5/1 ARM 7/1 ARM Or 30-Year Fixed
  • Gift Funds Allowed
  • No Pre-Payment Penalty 
  • or Owner-Occ And 2nd Homes + Investment!
  • SFRs, Townhomes, Condos, 2-4 Units
  • Seller Concessions To 6% (2% For Investment)
  • Mix Of Both Personal And Business California Bank Statement Deposits OK!
  • SAME DAY APPROVALS! CALL NOW 954-667-9110Bank Statement Only California borrowers that can document their income by providing the following:
    1. California Bank Statement Lenders Worksheet to record deposits
    2. California Bank Statement Lenders 24 Month Profit and Loss Statement Request
    3. NO TAX RETURNS NEEDED!!!

    12 OR 24 Months California Bank Statement Only Employment Types:

    • Self Employed
    • 1099
      o Must provide business license, Tax Preparer’s NOT Audited letter or corporate paperwork.

    California Bank Statement Only mortgage lenders will accept Personal or Business Bank Statements.  However, qualifying income will be calculated differently.

    California Personal Bank Statements:  100% of Deposits- Add all deposits for all 24 months and divide that amount by 24 to receive the monthly income amount we will apply as the borrower’s qualifying income.

    Ex. 12 months deposits total = $200,000 / 12 = $16,666 a month income.

    California Business Bank Statements:  90% of Deposits- divide by 12 to receive the monthly income amount we will give to the borrower.

    2 or 24 Month borrower prepared P&L statement: (all loans under $5 Million would require the following)

     P&L prepared and signed by the Self Employed Mortgage Applicant borrower; and

     A business narrative provided by the Self Employed Mortgage Applicant borrower which includes detail regarding the size and operating profile of the Self Employed Mortgage Applicant business addressing; location/rent, number of employees/contractors, COGS, Trucks/Equipment (Owned or leased). The expenses listed on the P&L should address all items disclosed in the narrative.

     24-months of business bank statements covering the most recent time-period and matching the same period covered by the P&L;

     The underwriter analysis of the Self Employed business and P&L will require a basic understanding of the Self Employed borrowers business. The narrative provided by the Self Employed borrower should be reviewed to determine if the business provides a service or produces/manufactures goods. If the business has a website, it should be reviewed to gain additional information on the business and its size. The goal of the analysis is to determine if the individual/total expenses as provided by the borrower on the P&L appear reasonable for the type of business. The items that may be considered in this analysis;

    o Description of Self Employed business from the narrative

    o Location of Self Employed business – Home based or lease space (Google address)

    o Utilities – Phone, electric, internet

    o Number of employees or contractors – employee taxes, payroll expense

    o Cost of Goods Sold – What type of materials does the Self Employed business use or manufacture.

    o Equipment or Trucks/Vehicles owned or leased

    o Type of client base – retail or commercial

     The Self Employed underwriter should provide notes of their analysis on the U/W approval

    form/1008/or within the bank statement calculator.

    o Self Employed Expenses must be reasonable for the type of business;

    o The pattern of deposits and payment should be consistent;

    o Expectations of changes in deposit pattern must be considered;

    o Income documented separately but co-mingled must be backed out of deposits.

SELF EMPLOYED MORTGAGE QUESTIONS

California Self Employed Mortgage Lenders Serving Every City in CA including  Anaheim, Apple Valley, Bakersfield, Berkeley, Carlsbad, Chula Vista, Clovis, Concord, Corona, Costa Mesa, Daly City, Davis, El Cajon, Encinitas, Escondido, Fairfield, Fontana, Fremont, Fresno, Glendale, Hayward, Hemet, Hesperia, Huntington Beach, Irvine, Laguna Niguel, Lancaster, Lodi, Long Beach, Los Angeles, Merced, Milpitas, Modesto, Moreno Valley, Napa, Oakland, Oceanside, Oxnard, Palmdale, Pasadena, Petaluma, Redding, Riverside, Roseville, Sacramento, Salinas, San Bernardino, San Buenaventura, San Diego, San Francisco, San Jose, San Mateo, San Rafael, Santa Ana, Santa Barbara, Santa Clara, Santa Clarita, Santa Cruz, Santa Maria, Santa Rosa, Santee, Simi Valley, Stockton, Sunnyvale, Thousand Oaks, Torrance, Turlock, Vacaville, Vallejo, Victorville, Visalia and Vista.

When determining the appropriate qualifying income for a California self-employed borrower, it is important to note that California business income (specifically from a partnership or S corporation) reported on an individual IRS Form 1040 may not necessarily represent income that has actually been distributed to the California self-employed mortgage applicants. The fundamental exercise, when conducting a California self-employed mortgage applicants income cash flow analysis, is to determine the amount of income that can be relied on by the California self-employed mortgage applicants in qualifying for their personal mortgage obligation. When underwriting these California losself-employed mortgage applicants, it is important to review California business income distributions that have been made or could be made to these borrowers while maintaining the viability of the underlying California business. This analysis includes assessing the stability of California business income and the ability of the business to continue to generate sufficient income to enable these California self-employed mortgage applicants to meet their financial obligations.

Los Angeles ca Self-Employed MORTGAGE APPLICANTS

Any individual who has a 25% or greater ownership interest in a business is considered to be self-employed.

  • The following factors must be analyzed before approving a mortgage for a self-employed borrower:
  • the stability of the borrower’s income,
  • the location and nature of the borrower’s business,
  • the demand for the product or service offered by the business,
  • the financial strength of the business, and
  • the ability of the business to continue generating and distributing sufficient income to enable the borrower to make the payments on the requested mortgage.

Length of Los Angeles ca Self-EmployED

Fannie Mae generally requires lenders to obtain a two-year history of the borrower’s prior earnings as a means of demonstrating the likelihood that the income will continue to be received.

However, a person who has a shorter history of self-employment — 12 to 24 months — may be considered, as long as the borrower’s most recent signed federal income tax returns reflect the receipt of such income as the same (or greater) level in a field that provides the same products or services as the current business or in an occupation in which he or she had similar responsibilities to those undertaken in connection with the current business. In such cases, the lender must give careful consideration to the nature of the borrower’s level of experience, and the amount of debt the business has acquired.

Verification of Self-EmployED Income

The self-employed mortgage lender may verify a self-employed borrower’s employment and income by obtaining from the borrower copies of his or her signed federal income tax returns (both individual returns and in some cases, business returns) that were filed with the IRS for the past two years (with all applicable schedules attached).

Alternatively, the lender may use IRS-issued transcripts of the borrower’s individual and business federal income tax returns that were filed with the IRS for the most recent two years—as long as the information provided is complete and legible and the transcripts include the information from all of the applicable schedules. (See B3-3.1-06, Requirements and Uses of IRS Request for Transcript of Tax Return Form 4506-T.)

When two years of signed individual federal tax returns are provided, the lender may waive the requirement for business tax returns if:

  • the borrower is using his or her own personal funds to pay the down payment and closing costs and satisfy applicable reserve requirements,
  • the borrower has been self-employed in the same business for at least five years, and
  • the borrower’s individual tax returns show an increase in self-employment income over the past two years.

For certain loan casefiles DU will issue a message permitting only one year of personal and business tax returns, provided lenders document the income by:

  • obtaining signed individual and business federal income tax returns for the most recent year,
  • confirming the tax returns reflect at least 12 months of self-employment income, and
  • completing Fannie Mae’s Cash Flow Analysis (Form 1084) or any other type of cash flow analysis form that applies the same principles.

Analysis of losself-employed MORTGAGE APPLICANTS PERSONAL INCOME 

The losself-employed mortgage lender must prepare a written evaluation of its analysis of a self-employed borrower’s personal income, including the business income or loss, reported on the borrower’s individual income tax returns. The purpose of this written analysis is to determine the amount of stable and continuous income that will be available to the borrower. This is not required when a borrower is qualified using only income that is not derived from self-employment and self-employment is a secondary and separate source of income (or loss). Examples of income not derived from self-employment include salary and retirement income.

The lender may use Form 1084 or any other type of cash flow analysis that applies the same principles as Fannie Mae’s form.

A copy of the written analysis must be included as part of any loan application package that the lender submits to Fannie Mae for a mortgage that is selected for a post-purchase quality control review.

Analysis of Borrower’s Business Income

When a borrower is relying upon self-employed income to qualify for a mortgage and the requirements that permit the lender to waive business tax returns are not met, the lender must prepare a written evaluation of its analysis of the borrower’s business income. The lender must evaluate the borrower’s business through its knowledge of other businesses in the same industry to confirm the stability of the borrower’s business income and estimate the potential for long-term earnings.

The purpose of this analysis is to:

  • consider the recurring nature of the business income, including identification of pass-through income that may require additional evaluation;
  • measure year-to-year trends for gross income, expenses, and taxable income for the business;
  • determine (on a yearly or interim basis) the percentage of gross income attributed to expenses and taxable income; and
  • determine a trend for the business based on the change in these percentages over time.

The lender may use Fannie Mae’s Comparative Income Analysis (Form 1088) or any other method of trend analysis that enables it to determine a business’s viability, as long as the method used fairly presents the viability of the business and results in a degree of accuracy and a conclusion that is comparable to that which would be reached by use of Form 1088.

A copy of the written analysis and conclusions must be retained in the individual mortgage file.

Use of Los Angeles Business Assets

When a borrower intends to use business assets as funds for the down payment, closing costs, and/or financial reserves, the lender must perform a business cash flow analysis to confirm that the withdrawal of funds for this transaction will not have a negative impact on the business. In order to assess the impact, the lender may require a level of documentation greater than what is required to evaluate the borrower’s business income (for example, several months of recent business asset statements in order to see cash flow needs and trends over time, or a current balance sheet). This may be due to the amount of time that has elapsed since the most recent tax return filing, or the lender’s need for information to perform its analysis. See B3-4.2-02, Depository Accounts, for additional information on business assets.

Income Verification for LOS ANGELES Self-Employed Co-Borrowers

When co-borrower income that is derived from self-employment is not being used for qualifying purposes, the lender is not required to document or evaluate the co-borrowers self-employment income (or loss). Any business debt on which the borrower is personally obligated must be included in the total monthly obligations when calculating the debt-to-income ratio.

LOS ANGELES Verbal Verification of Employment

For requirements regarding verbal VOEs, see B3-3.1-07, Verbal Verification of Employment.

Your Los Angeles Business Structure Matters

There are several different ways to structure your California business that include sole proprietorship, partnerships, LLCs and S corporations.

Under a sole proprietorship, your California business income is reported on schedule c of your tax return. With a partnership profits in the California business are split between partners based on their respective percent of ownership. Limited Liability Corporations are considered pass-through entities for tax purposes. S corporations follow strict guidelines for distributions. Depending on how you structure your California business you could potentially pay yourself on a w-2 and avoid the hurdles of a California self-employed mortgage lenders California self-employed mortgage lenders mortgage completely. Your accountant can help you choose the optimal California business structure for your company.

No matter how you choose to structure your California business there are steps you can take to maximize your income form self-employment and maintain an optimal debt ratio. All of these factors are under you control and are part of maintaining healthy finances as a California self-employed mortgage lenders California self-employed mortgage lenders worker.

Los Angeles California self-employed mortgage lenders

If you’re going to finance your California home purchase with traditional financing that is conforming to Fannie Mae and Freddie Mac guidelines you will be required to document your income from self-employment. In general, Fannie Mae will want two years worth of tax returns to document your net income and prove California business solvency. Meeting this requirement can be difficult for borrowers that are just starting out with their California business.

If you’re purchasing a new California home or refinancing your existing mortgage there is a specific process everyone goes through to get approved for a California home loan. Under the old guidelines, California los self-employed mortgage lenders California los self-employed mortgage lenders works had difficulty qualifying based on proof of income. This happens for a variety of reasons including how a California business is structured and even deductions taken on tax returns.

Many California self-employed mortgage lenders California self-employed mortgage renders workers have no history of paychecks that can be documented. They take may take distributions with no regular amount or frequency making qualifying based on income difficult even with bank statements and tax returns.  If your California business is new and you don’t have documented sources of revenue or even two years of federal tax returns this can make qualifying for a traditional mortgage difficult, if not impossible.

If you have a history of paying yourself from your California business, Fannie Mae’s guidelines state that your California business only need to have adequate revenue to support your future distributions. Your lender will require documentation that your California business is legitimate and solvent. This could be provided in the form of your letters of incorporation or the K-1 filing which highlights your percent ownership in the California business.

The underwriting process is still going to be more complicated for California losself employed mortgage lenders California self-employed mortgage lenders borrowers. Fannie Mae and Freddie Mac have similar processes to verify income from self-employment. These requirements follow the ability to repay guidelines to ensure that you have adequate income from self-employment to repay the loan. Lenders adhere strictly to these guidelines so that the loans can be sold to Fannie Mae and Freddie Mac.

If you don’t have two years of California business tax returns the guidelines you may be able to qualify for a bank statement program using your personal bank statements as an alternative to a conventional mortgage. These types of programs are available from boutique portfolio lenders and offer reasonable rates and fees.

Common Issues for California Los Angeles self-employed mortgage Applicants

The most common roadblock California self-employed mortgage lenders California self-employed mortgage renders workers face is proving how much your net income is from the California business based on tax returns and deductions. You may have significant cash flow in your California business but could be in for a shock when you learn your qualified net income based on tax write-offs and expenses for your California business. If you cannot demonstrate sufficient net income from your California business it still may be possible to qualify for a bank statement program using income on your personal statements.

California business Tax Deductions Case Issues For Mortgage Lenders

Running a California business as a California self-employed mortgage lenders worker can be very expensive and often comes with significant tax liability. The temptation for Los Angeles business owners can be to lower your taxable income with deductions. These deductions include California business expenses for things like equipment, expense accounts, and annual depreciation.

Taking Los Angeles California business deductions may save you money on your taxes but it could make it more difficult to qualify for a mortgage. As a California, Los Angeles self-employed mortgage lenders see you are qualified for a mortgage based on your net income, not gross income for a traditional worker.

Most California losself-employed mortgage lenders California losself-employed mortgage lenders California business owners claim as many tax deductions as the law allows which significantly lowers your net income and therefore your ability to qualify for California mortgage

Debt to Income Ratio for the self-employed mortgage

Maintaining a low debt to income ratio is important in qualifying for any California mortgage loan. As a California self-employed mortgage lenders review your debt to income ratio is calculated differently from traditional W2 workers.

Your debt ratio is calculated by your average net income from the most recent tax returns along with current year income and expenses. In order to be approved for a self-employment mortgage, your debt-to-income ratio cannot be more than 43 percent.

If you’re considering purchasing a new California home or refinancing your existing mortgage you might want to consider taking fewer tax deductions to reduce your debt-to-income rate with the highest possible net income.

California Mortgage Documentation Makes a Difference

The loan process you’ll go through as a California self-employed mortgage lenders California self-employed mortgage lenders worker is the same as everyone else. Where it gets sticky is providing documentation. The more you have to prove that California business is sustainable and solvent, the easier the process becomes.

Keeping meticulous records of income and expenses will make it easier to prove that you are a viable California business as well as documenting net income which is essential for maintaining a favorable debt ratio.

Mortgages for California self-employed mortgage lendersWorkers

Mortgage lenders generally consider California self-employed mortgage lenders California self-employed mortgage renders workers to be higher risk than those who work for a traditional paycheck. Higher risk borrowers pay more at closing and over the life the loan with higher interest rates. If you’re accepting a higher interest rate when you purchase your California home you may be able to lower that rate down the road by demonstrating a reliable payment history and refinancing.

California Self Employed Mortgage Lenders Serving Every City in CA including  Anaheim, Apple Valley, Bakersfield, Berkeley, Carlsbad, Chula Vista, Clovis, Concord, Corona, Costa Mesa, Daly City, Davis, El Cajon, Encinitas, Escondido, Fairfield, Fontana, Fremont, Fresno, Glendale, Hayward, Hemet, Hesperia, Huntington Beach, Irvine, Laguna Niguel, Lancaster, Lodi, Long Beach, Los Angeles, Merced, Milpitas, Modesto, Moreno Valley, Napa, Oakland, Oceanside, Oxnard, Palmdale, Pasadena, Petaluma, Redding, Riverside, Roseville, Sacramento, Salinas, San Bernardino, San Buenaventura, San Diego, San Francisco, San Jose, San Mateo, San Rafael, Santa Ana, Santa Barbara, Santa Clara, Santa Clarita, Santa Cruz, Santa Maria, Santa Rosa, Santee, Simi Valley, Stockton, Sunnyvale, Thousand Oaks, Torrance, Turlock, Vacaville, Vallejo, Victorville, Visalia and Vista.

 California Business Entities

  • News & Notices: Get the latest information about changes affecting business conducted with the Business Programs Division.
  • Customer Alerts: Get the latest information about confirmed scams against Californians and businesses in the State of California, and what you can do if you have been a victim of a scam.
  • Get the current processing times for Business Entities and determine which method of submission meets your needs.

CA Business Lenders Online Services

 

All LLC Statements of Information and the required Statement of Information for most corporations can be submitted electronically using a credit card. PDF copies of imaged business entity documents, including Statements of Information are available for free on the Secretary of State’s Business Search.

Note: Statements of Information for common interest developments must be submitted on paper, by mail or in person (drop off), at this time.


The Business Entities Section of the Secretary of State’s office processes filings, maintains records and provides information to the public relating to business entities (corporations, limited liability companies, limited partnerships, general partnerships, limited liability partnerships and other business filings).

  • Service Options: Options for online searches and filings, document processing and information requests (for certificates, copies and status reports)
  • Name Availability: Corporation, limited liability company and limited partnership name availability inquiries and reservations
  • Forms, Samples & Fees: Forms, document samples and associated fees
  • Statements of Information (annual/biennial reports): Corporation and limited liability company statements of information, common interest development association statements and publicly traded disclosure statements
  • Filing Tips: Tips for filing most corporation, limited liability company and limited partnership documents
  • Information Requests: Orders for certificates, copies and status reports
  • Service of Process: Substituted service of process
  • FAQs: Answers to the most frequently asked business entity questions
  • Victims of Corporate Fraud Compensation Fund: Restitution to victims of corporate fraud

General provisions governing most business entities are found in the California Corporations Code.

FHA Mortgage Lenders By State: 
Florida   Texas  Georgia  Alabama   California  

Latest pages

Serving These Fine Texas Cities

About Us

We are US Mortgage Lenders. Major real estate brokerages regularly entrust their clients to our team due to our reputation for transparency, delivering on time, customer satisfaction and loyalty. With five-star customer reviews on Zillow.com and counting, you’re assured of having the backing of an experienced team.

Show Buttons
Hide Buttons