We are finding quite often that we only get asked for 1-years returns by Fannie or Freddie. The loan has to be run through the agencies automated underwriting program and the stronger the file the more likely the borrower will only be asked for 1-yr. Many lenders have additional requirements of 2-years regardless of the findings though, but it is possible to get it done usually with 1-year. If you have not filed your 2013 returns it might be wise to meet with a lender and determine what income level is required to accomplish your goal. I have seen self employed borrowers be exactly $1/mo short on income to qualify. If they had only forgot to deduct one cell phone bill! Borrowers cannot claim more income than they actually received, that would be loan fraud. But there is no requirement that they deduct every eligible expense and fair or not, mortgage underwriting goes by the taxable adjusted gross income with add backs for physical depreciation and possibly a few other items. If you are looking for a loan in CO please contact me and I will steer you through this subject.
I would respectfully disagree with others here, Fannie mae will quite often go with one years taxes for self employed people, this is a recent update to their requirements. To find out though one needs to submit a loan application, have credit pulled and the lender run the loan through desktop underwriting. It can be a bit hit and miss but I've gotten a couple self employed people financed lately with just one years taxes. Contact me to discuss your situation further.
The company we pull reports through has a credit score simulator, which I have used several times and when the borrower does exactly what we put in the simulator we get highly accurate results. In your case we could simulate the impact of updating the credit report via rapid rescore and see what the impact would be. Check my website: http://www.mtnmortgageguy.com to contact me if you would like to discuss this further.
Either a reverse mortgage or a FHA 203K loan would work in this situation. Depending on the loan amount needed for repairs and Moms overall situation, the reverse mortgage might be more bang for the buck, although both have closing costs. If you only need say $10-$20k for the repairs the closing costs on the FHA are going to seem steep for what you get. The reverse would allow her a lump sum of cash to do the repairs and a line of credit to draw on for future living expenses or repairs.
I write a weekly column for the local Vail Daily (Colorado) and am a mortgage broker. I'd be interested in being a blog contributor, hows that work on Zillow?