Self-employed buyers often struggle to qualify for a traditional mortgage when they are starting out in their business. Cannabis owners are no exception to this situation! Starting a new business can be costly in the beginning and it often can take several years to start realizing consistent income. Business owners typically invest capital in their companies to get started which can lead to income taxes that show very little income. Unfortunately, this can ruin plans for homeownership if income is too little to qualify.
As portfolio lenders continue to make a come-back, so do non-traditional mortgages! A Bank Statement loan may be the perfect solution for a Cannabis owner looking to purchase a new home or refinance. With a Bank Statement loan, the lender will analyze 12 or 24 month’s work of bank statements (business or personal) and use this as a source to calculate income. They will take an average of all deposits and use this calculation to establish a monthly income that can be used to qualify for a mortgage. The lender will not require individual or business tax returns to support income qualification. The borrower will need to be self-employed for a minimum of two years. The lender will rely on the borrower’s other strengths as well when it comes to qualifying; cash reserves, credit, residual income, rental history, etc.
About the Author:
Michaela Phillips entered the mortgage lending industry in 1994. Throughout her 25 years in the business she’s been one of the top producers for every company she’s worked for. As of 2019, she’s the VP of Mortgage Lending for Guaranteed Rate, Inc. Being a VP at Guaranteed Rate offers many advantages to her and her clients, unparalleled customer service, efficiency, and most importantly, competitive rates.