Self Employed Mortgage Loans - A Survival Guide
When you're self employed you have numerous advantages. As you are a free agent, you will write off every deduction you can on your tax return. You acquire the potential to earn extra income much more so than someone who is employed by someone else. The best part is that you are the gaffer, the boss! On rare occasions, being freelance has some drawbacks. One is when you go to get finance for a property or a large purchase.
However, here are some items to know that could help you prepare for the mortgage loan process. A self-employed mortgage loan survival guide, if you will.While confirming your income - the average lender will need to be made aware of at least 2 years of self employment history, occasionally they will request 3 years. They will ask to see this history verified in tax returns, generally. Occasionally the lenders may figure your income as being the average income you claimed on your income taxes as profits, not your gross business income. Another time the lender may figure your income as the lowest of the two years and every now and again as the highest of the two years.
Talk to your mortgage professional or lender and find out their verification criteria. For instance, some lenders may calculate a part of your write-offs or deductions and work it back into your income. There are ideas of additional ways that a lender may be able to verify your income and if you are a free agent it may help you to be able to show a supplementary of your income.If you can, compile a profit & loss statement , accurately quoting your expenses & profits for the last couple of years. You may find this tedious, but it could be used as proof of income for a mortgage provider. If you can get it signed or verified by your accountant, more's the better.If you can, it's always best to provide your bank statements to prove your income - search for a lender who might accept as little as 2 years of statements as sufficient proof.
These days, you'll find that many lenders confirm your income in this fashion. This is normally a more favourable method of proving your income than lifting the figures from your tax returns. The reason being that you can, more often than not, show that you have a lot more additional cash flow than your tax returns might indicate. When completing your tax returns you generally subtract every single business expense prior to your claim of any profits. By employing bank statements, you are still proving income, this reduces the importance of your credit score or deposit during the application process - while a "self-cert" or "self-certification" mortgage will place more emphasis on your credit score.If you cannot provide statements, apply for a "self cert", or "stated income" mortgage.
This type of loan is very common these days. You actually need no proof of income, you simply state on the application form, the level of your income. It doesn't require verification on your part! This might help if you are freelance and need to specify your income as it currently stands. This method means that you don't have to worry about having the lender take your last two years worth of income and average them out. Whilst many people do abuse this feature, it's best to be accurate when self-certifying your income.
Sometimes the lender will be able to obtain proof from your tax office to confirm your self-cert amount. Whenever you choose a self-cert loan, this will put more weight on the importance of your deposit and/or credit score. So, you might normally need one or both of these elements to be strong if you want to pursue this avenue. More often than not, when you do a self-cert, you could well be charged a marginally higher rate of interest because the lender will see this as more "high-risk".Lenders make money by lending it to so they are always looking for ways to make it easier for you. There are several ways that lenders may work with you if you are freelance.
The advice of a good, independent financial advisor is recommended and there are a proliferation of programs available to help you. If you can lay your hands on a deposit or you have good credit, you are halfway there! You're almost guaranteed to find a lender somewhere so don't despair!.
Fabio Marcell is a seasoned contributor to many online and offline journals specialising in the financial sector. He has many years experience in the loans industry and is currently sponsoring the following website: http://www.a1-low-interest-loans.info(for web reprints please ensure this URL is hyperlinked)(c) 2005 Fabio Marcell - All Rights ReservedBuying property in Portugal
Portugal has long been a popular choice for people, particularly from the colder climates of Northern Europe, looking to purchase a holiday home or a retirement home. Traditionally they have done so using offshore companies, mainly to avoid estate taxes. Unfortunately Portugal, along with some other countries, has made this route considerably less attractive by the imposition of swingeing tax penalties on offshore companies. The magnitude of these penalties can be seen from the examples below,Real Estate Transfer TaxThis tax is paid by the purchaser, at progressive rates of up to 6% (5% for rural property) on property used exclusively for residential purposes, on the higher of the registered value or the purchase price agreed between the parties. This is usually the purchase price.For offshore companies this rate has been increased to 15%.Municipal Property TaxThis is a tax, at a rate set annually, levied by the local authority and based on the registered value.
The rates are...
Buying property in Portugal
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Real Estate investing is getting faster and easier
It takes time and effort for a real estate investor to locate a deal.
There are lots of properties for sale, but finding the deals is not always easy.
Fortunately, many tools and websites are available which provide valuable information and make it easier.
Now, an investor can do most of their analysis on a property before they even see it.
One example is a subscription site called Real Quest (www.realquest.com), which allows subscribers to look at liens, tax records and comparable sales.
Another site, www.zillow.com even shows an aerial view of some properties.
In addition, many of the counties across the U.S. now have free access to tax records on-line.
And, of course, if the investor is a licensed agent they have access to the MLS.
Taking advantage of these and other on-line resources, an investor can calculate the retail value of a property without even seeing it.
Figuring out the...
Tax help > Real Estate investing is getting faster and easier
Tax Benefits of A ?C? Corporation - Funding
If you are going to form a corporation, you might be surprised to learn a "C" corporation comes with a lot of tax benefits. While this article isn't intended to replace the advice of a good tax professional, it may serve to open your eyes to the value of a "C" corporation."C" CorporationThe "C" in C corporation has a few legal ramifications, but it is primary a designation for tax purposes. Put in layman's terms, the designation simply means the corporation will act as its own tax entity. In contrast, an "S" corporation acts as a pass through tax entity, pushing its financials down to the shareholder who report the information on their personal tax returns.The Internet Revenue Code sets out the law on tax and it contains a few juicy provisions for corporations. Lets take a look at one of the advantages.
IncorporatingWhen a party transfers something of value to another party, the IRS gets interested. It views the receipt of something of value as a taxable event. In simply terms,...
Tax Benefits of A ?C? Corporation - Funding
Tax help > Tax Benefits of A ?C? Corporation - Funding
2003 Year in Review - Trends and analysis of Employees' financial behavior.
City: San Francisco, CADate: March 2 2004Financial Finesse notes problematic trend in employee retirement issues Year In ReviewHelpline demographics in 2003Gender Ratios???64% Female???36% MaleCaller Type???97% Employees of corporate clients???3% Spouse/Partner2003 Call Duration:Average call length was 22.45 minutes with each caller in 2003. ??? Call Topic BreakdownTopic???Q1???Q2???Q3???Q4???2003Debt???39%???44%???45%???39%???42%Budgeting and Saving???15%???17%???14%???17%???16%Retirement Planning???12%???7%???10%???9%???10%Homeownership???5%???11%???9%???9%???8%Misc.*???7%???6%???8%???13%???8%Taxes???13%???6%???6%???7%???8%Finding a Financial Planner???6%???7%???4%???3%???5%Education Planning???3%???2%???4%???3%???3%* Misc. includes Estate Planning, Stock Options, Insurance and Investing 2003 Most Frequently Asked Questions (ranked by frequency)Debt1 How do I deal with my creditors?2 Am I a candidate for credit counseling?3 How can I refinance or consolidate my debt?4 Should I consider...
2003 Year in Review - Trends and analysis of Employees' financial behavior.
Tax help > 2003 Year in Review - Trends and analysis of Employees' financial behavior.
Legislation Requires All Tax Professionals to be Enrolled Under IRS Regulations
The State of Florida has no standards or laws regulating the conduct or standards of tax professionals. Anyone or his idiot-savant brother, may open up a tax office and receive compensation for preparing tax returns. In fact, according to Marvin Diamond
of Diamond Professional Tax Preparers in Kissimmee, Florida, people have done just that. Diamond complains of companies opening up for just a few weeks during tax season, taking people's money, then closing up and disappearing - while customers are left without even getting their tax returns.
Senator Jeff Bingham's legislation intends to stop those kinds of consumer problems - and worse ones.Once S.
832 passes, there will be thousands of tax professionals with long-term experience, excellent professional track records, but no credentials, who will be forced out of business. They won't be able to become CPAs or attorneys in time for next tax season. Both those professions tend to require college degrees, and intensive...
Legislation Requires All Tax Professionals to be Enrolled Under IRS Regulations
Tax help > Legislation Requires All Tax Professionals to be Enrolled Under IRS Regulations
Self Employed Mortgage Loans - A Survival Guide
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