Getting financed while self-employed can be challenging but… it is doable! Don’t worry about finding specific mortgage companies for a self-employed borrower. You can apply for the same loans that a “traditional” employed borrower can. Whether you are looking for a personal loan or a business loan here is a list of things that your lender will need and base your approval on.
1. Personal Financial Statement
A PFS is a document that lists what you own and what you owe. Once you complete this document you will have your personal net worth. If you already have a PFS, it’s important to update it annually.
2. Two Years of Personal Tax Returns
If you do not have a copy of your personal tax returns, your accountant should be able to send these to you.
3. Two Years of Business Tax Returns
If you do not have a copy of your business tax returns, your accountant should be able to send these to you.
4. Business Documentation
Odds are, your lender is going to need your Articles of Incorporation, Bylaws or Operating Agreement, as well as your Federal EIN. If you are unsure where to find these you can reach out to LegalZoom, RocketLawyer, or your attorney.
5. Profit and Loss Statement
A profit and loss statement is a document that will show your company’s revenues and expenses within any period of time. Yes, this is very important to keep updated!
You should be able to get a copy of your credit report on LifeLock, Experian, Equifax, etc. Did you know that you are legally entitled to a free copy of your credit score once a year?
Yes, getting financed as a Self-Employed borrower is definitely doable, but your lender is going to put your finances under a microscope. As to be expected, they need to make sure that you will be able to make your payments. If you’re looking for a lender please reach out to us, we would be happy to walk you through this process and get you the funds you need.
-Legacy Frontline Team