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I have a 15 year fixed rate and want to refinance to another 15 year. I am self-employed. Advice?

Profile picture for ASalkever
I have a 15 year fixed at 5.625. I want to refi to a much lower rate (I believe they are running below 4.5% right now. I have been self employed for roughly six months and have ample income and solid assets. LTV on this loan is low, roughly 60%. I have been told its hard to get loans if you are self-employed. Any advice?
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March 19 - Kaimuki
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Answers (4)

Profile picture for Blimy
Real Estate Agent
Contributions: 3
Hi ASalkever,
being a self employed for 6 month is not enough time, what did you do before that? now as you know there are other factors in Refi, credit fico, Assets,,steady income ( bank statments or paystubs), so you might wanna consider these avenues 1st,,,let me know if you have any other questions, good day.
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July 08
Profile picture for Orin Sherman MBA
Real Estate Agent
Contributions: 58
Use the opportunity to instead pay down the principal. 
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July 08
Yes you will need 2 years in your new business to qualify for a loan.
You will also need to show enough income on your taxes (net income) to cover your new mtg payment and other debts and stay under 42% DTI ratio. This is not an easy task for the majority of self employed borrowers. We have a tendency to write off all our income as to not pay taxes. This mindset will need to change over the next several years if self employed people want to buy or refi homes in the US. We can only hope lenders will come up with an alternative. 
You are one of the lucky ones with a great mtg and rate.Good Luck with your new business. 
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July 06
Profile picture for Ashley Blanton
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Contributions: 158
Sorry, but 99% of the lenders out there will require you to have 2 years employment as a self employed borrower. FHA sometimes requires 1, but you will pay in MI.

PAR pricing for a PERFECT borrower is around 4.625 right now, so you still have a really great rate.

Hopefully they will stay this low for the next 1 1/2 years then you can refi! Good luck!
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March 19
 

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