I have been living in my house of 9 years and recently tried to refinance my loan... but cant

The last two tax returns show little to no income because im self employed. Even though I make money (over $40,000 and as much as 78,000) I cant get refinanced. What is going on with the banking system for self employed people?
  • May 11 2009 - Saint Charles
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Answers (4)

Profile picture for wetdawgs
If your business expenses are so great that you can make your income go down to a taxable zero, then of course the banks are not interested.  They want you to be able to repay the money you borrow from them but you report to the feds that your business expenses are too high to be able to do so.

The banking system works well for self employed people who report an income, but apparently your business is still too young to do so.  

Or, you could amend your tax forms.
  • May 13 2009
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It's good and bad.

It seems that banks would rather take a risk with someone that has 620 score on FHA and give them a great rate but take a pass on someone that has phoneomenal credit, proven mortgage history, and assets.

These are the times we're living in.

I would say just just sit tight, i don't think this will last too long.www.mysupremehomeloans.com
  • May 13 2009
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Lisa-
If your expenses are truly outweighing your income on your tax returns, why would a bank consider you a good risk for a loan? Stated loans (when they were available) existed as a courtesy to borrowers, not so you can lie on an application. Basically what you are saying is you made more income than you want to be taxed on, or you truly have expenses outweighing your income. In either case, you either don't qualify for a loan or you are avoiding paying taxes. Am I missing something?
  • May 11 2009
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Unfortunately this is one loan scenario that is nearly impossible to get done nowadays.  You might consider amending your returns!
  • May 11 2009
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