Real Estate Community Forum

I am self employed and every year my income fluctuates. I realize getting approved for a mortgage is highly dependent on the amount of income you generate per year. However, since I am self-employed, will my fluctuation in income effect my chances of being approved for a mortgage? Will they look at other documents besides my tax returns? Also, do they look at the number of years you've been self-employed?

It is my understand that self employed individuals have a more difficult time getting approved because of your range in income through out the years. In addition, self employed people also have a lot of deductions through out the year that also changes your income. Having said this, be prepared to show tax returns, bank statements, and any other financial statements of the past two years.

In regards to the number of years your business has been in operation, the longer it has been open the better. One of the mistakes some business men do is change the business or provide a different business venue during this two year period. If you do this, the lender will consider this a risk and deny you a mortgage.