Risk Less by Choosing the Right Lender for Your Self Employment Home Loan

If you own your own business, you may find that you have trouble getting a home loan due to strict debt to income ratios and other regulations imposed by banks. There are self employment home loans that can make getting a home loan easier. Choosing the right lender or mortgage broker can make all the difference and help make your home ownership dreams a reality.

Owning your own business has many advantages. For one, you get to be your own boss and set your own schedule. You also have the opportunity to do exactly what you want to do and grow your business in a way that makes sense for you and your family. You are not a slave to the time clock and you don’t have to deal with a domineering boss breathing down your neck. You also can take advantage of many tax write offs and can pay yourself what you are worth.

However, there can also be a downside to being self-employed, especially when it comes to qualifying for a home loan. Tax deductions can make it look like you are losing money when in fact your business is quite successful. Business loans or other debt can make your debt to income ratio look very high and having a number of business loans may even end up taking a toll on your credit. Rigid lending standards can cause banks to take one look at your tax returns and send you out the door so fast your head will spin.

This can be very disheartening. You have spent your life building a successful business, but the very elements that make you successful make you look like a lending liability. Even if you have a steady stream of income, it may be difficult to verify using traditional lending standards and the situation may seem hopeless. But, don’t fret. There are many, many options for self employment home loans and many lenders who can help you find the home loan that you need.

4 Benefits of Using a Private Lender for your Self Employment Home Loan

If you find yourself in the unfortunate situation of being denied by a bank, start thinking about a private lender. A private lender is a mortgage broker or investment firm that has access to private funds and collateral that can be used to fund a self employment home loan. A private lender is licensed by the state that he works in and still must adhere to federal fair lending practices and guidelines. This is good news for you because it provides protection for your investment and recourse if you feel you have been treated unfairly.

There are many benefits to using a private lender compared to a bank. Here are four of the most common benefits that a private lender can offer.

1.       Easier qualification process. Since private loans are funded by investors, there are less stringent qualification requirements. This means that bad credit, high debt to income ratios due to business loans or tax deductions, or even previous foreclosures or business failures matter much less. A private lender is more likely to look at your entire financial pictures as well as the potential to make money on an investment property than a bank is. This makes getting a loan easier. Also, there is a lot less paperwork which can be a huge bonus for the busy business owner.

2.       Faster qualification process. A bank can take 30 to 45 days and in some cases even more to fund a loan. With a private lender, the process can take as little as a week. This is great news if you want to buy a property quickly or want to make your offer stand out in a bidding war. Often sellers will take a lower offer with a faster close time to unload the property quickly.

3.       Investment opportunities. Private lenders and private self employment home loans are often tailored for investment properties. As a business person, you know the value of real estate investing and can take advantage of a private lending firm.

4.       A private lender has access to loans that banks do not. From hard money loans to other private collateral loans, a private lender can find the right loan for you.

Don’t delay, act today!

Find a private mortgage lender to get started on your self employment home loan. You will be glad you did!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

  

How to Use Arizona Bridge Loans to Benefit your Small Business

Arizona bridge loans are gaining popularity in the housing market as a way to bridge the down payment gap and allow buyers to purchase a new home before selling their current home. They are also a valuable tool for small business owners to get cash quickly based on business collateral and upcoming deals.

Arizona bridge loans are short term loans that are designed to bridge the gap between needing liquid cash and a future investment paying off. The most common use of Arizona bridge loans are during the home buying process to bridge the gap between needing a down payment for a new home and selling a current home. The bridge loan is secured to the original home, the one that's on the market. The funds from that loan are used as the down payment for the mortgage on the new home. 

There are no strict guidelines when it comes to Arizona bridge loans so credit score and debt to income ratio are not usually factors that will automatically disqualify you. This is good news for borrowers with less than stellar credit or who may have a high debt to income ratio once they purchase their new home. Instead, bridge loans are based on a few different factors, including how likely it is that you will sell your current home quickly, and whether or not you can make both mortgage payments for a short time if it becomes necessary. If you default on a bridge loan, the lender has recourse to get their money back using the property you have on the market because it is the one that secured the loan.

A bridge loan can be a good option for individual borrowers who want to purchase their next dream home but have not sold their current home. A bridge loan usually has a higher interest rate but certain loans allow you to skip payments, making it unlikely that you will have to pay any of the interest as long as you sell your home quickly. A bridge loan also allows you to put your home on the market quickly and without any schedule restrictions. You can even stage it to make it sell more quickly. A vacant home will usually sell more quickly and for top dollar so a bridge loan can help you earn more money on your home sale.

How to Use Arizona Bridge Loans as a Business Owner

A less common but still beneficial use of Arizona bridge loans is to help your small business when you are strapped for cash. Sooner or later most business experience a cash flow issue. A bridge loan can help "bridge" the gap between today's need for immediate cash to pay bills and the final closing of a pending investment deal or long-term financing package.

If you find that you need some immediate cash before a big deal pays out, a bridge loan can be a good solution for your business. In order to secure the loan you will need to prove your ability to pay the loan back. A few ways to do that is through:

·       Earnings. It is possible that a lender may be willing to extend a bridge loan on the basis of earnings alone. You will need to have a stellar credit history, a consistent track record of making profits, and strong sales to show you can repay the loan in a short amount of time. Unless you are able to fulfill all of these requirements, you will need to find another way to obtain financing. ·       Collateral. If your earnings aren’t up to par, you can use business assets as collateral to obtain a bridge loan. Equipment, real estate, and other capital assets can all be used to secure a bridge loan. Contact a broker or investment professional to get started on finding the best bridgeloan for your business today! A broker can help you navigate the ins and outs of Arizona bridge loans whether you need one for business or real estate. Having the right financial professional by your side can help you risk less and benefit more. You can get the cash you need and help protect your current assets. Call our office today for more information on   Arizona bridge loans.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

  

Risks and Benefits of an Arizona Bridge Loan

An Arizona bridge loan is a specialized type of short term loan designed to help borrowers get cash fast and can be used to help you purchase a home. Knowing the risks, benefits, and ins and outs of bridge loans can help you make a smart decision.

An Arizona bridge loan is a common way for home buyers to come up with a down payment when they are buying a new home while concurrently selling their current home. Most buyers rely on the sale of their current home to come up with the down payment for their new home, however, it is not always feasible or ideal to close on the current home first. In a perfect world, you close on your home at 9:00 a.m., have funds available by 10:00 and close on your second home before noon. But it very rarely works this way. More often, you close on your current home and have to find a short term rental for a month or two before you close on a new home. This is not only expensive, but it causes you to have to move twice and you are literally throwing money away by renting.

One solution to the problem is an Arizona bridge loan. A bridge loan bridges the gap by lending you the down payment for a new home that you then pay back once your home sells. The bridge loan is secured to the buyer's existing home. The funds from the bridge loan are then used as a down payment on the new home. Bridge loans are gaining in popularity as a down payment option because they offer flexible terms and are relatively easy to qualify for. Also, many lenders will not allow you to take out a home equity loan on a home that is listed for sale, so in many cases a bridge loan is the only option to come up with cash for a down payment.

5 Things to Know About an Arizona Bridge Loan

Like any loan, a bridge loan has certain risks and benefits. Knowing all your options and going into it fully informed will help you risk less and benefit more. Here are five important things to keep in mind if you are thinking about getting an Arizona bridge loan.

1.       Qualification is usually an easy and painless process. Most lenders do not have set FICO scores or debt to income ratios for bridge loans. Instead, qualification is based on a complete picture of your finances and whether it makes sense to purchase a home before you sell your current one.

2.       You will pay a higher interest rate. Like many short term loans, bridge loans have higher interest rates than 30 year loans. You usually have a grace period of 1 to 4 months depending on your loan terms and if you pay the loan back with proceeds from your home sale, you can usually avoid paying a lot of interest.

3.       You have to be able to qualify for two mortgages. A bridge loan can help you with a down payment, but you will still need to qualify for two mortgages and be able to make monthly payments on both if push comes to shove. However, most mortgages don’t require a payment for the first month so if you sell your home quickly, you can usually avoid double payments.

4.       Bridge loans can help you sell your current home more quickly. A home that is lived in is always harder to sell than one that is vacant and staged. By moving into your new home, you will give yourself the best chance of selling your existing home quickly and for top dollar.

5.       You can find your new dream home without the stress of having to sell your existing home first. You don’t have to wait or make unattractive contingency offers. You can purchase your new home immediately which will usually get you a better price and help make sure you get the home you want.

If an Arizona bridge loan sounds like a good option for you, find a broker or private lender today to get the process started today!

At Level 4 Funding we specialize in bridge loans and other short term loan types. Call our office today to schedule a consultation to find out if a bridge loan is a good option for you. Don’t wait on a slow market to buy your next dream home. Use a bridge loan to get into the home you need today.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

  

The Benefits of Using a Private Lender for a Self Employment Home Loan

 If you are self-employed, it can be tricky to qualify for a home loan due to debt to income ratios and business losses. Using a private lender can make the process easier and has many other benefits when it comes to qualifying for a self employment home loan.

For many Americans, owning their own business is a dream come true. If you are self-employed you enjoy many benefits both financial and otherwise. Most likely you are able to set your own schedule and you answer to yourself. You can work from home or whatever environment you may choose. You can set your own dress code and hours and take time off when you need it. You can also take advantage of many tax deductions to write off most of your business expenses. Everything from large equipment purchases to pens for you home office can be tax deductible which can help you save big come April.

While you may enjoy your tax savings most of the time, it can be a double edged sword, especially when it comes to qualifying for a home loan. Many times, people who are self-employed have tax returns that do not accurately reflect their actual income due to deductions. Sometimes it can even make it look like you lost money when you in fact had a good year. Throw in any debt you may have for business or personal purchases and your debt to income ratio can make you look like a huge liability to a bank.

For these reasons, many business owners find it difficult to secure a traditional mortgage from a bank. However, there are many other options to find a self employment home loan that will work for you. One key to finding a loan is to think outside of the traditional bank or mortgage broker and find a private lender like Level 4 Funding to finance your loan.

Pros and Cons of Using a Private Lender for Your Self Employment Home Loan

For many business owners, a private lender is their best chance of securing a self employment home loan. However, like any major financial decision, there are pros and cons that need to be carefully considered before making a decision.

·      

Pro: A private lender often has a very short approval process. Banks and public lenders can take anywhere from 30 to 45 days (and sometimes more) to approve and fund a loan. If you need a quick loan to buy a property, this can be too long. Also, when it comes to a self employment home loan, traditional banks will likely have issues during underwriting and come back to you several times asking for more paper work, more proof of income, more documentation. A private lender can have you funds in as little as 1-2 weeks with significantly less paperwork.

·       Con: Private loans are usually more of a risk for the lender. As such, you can expect to pay a higher interest rate for the loan.

·       Pro: Easy to qualify. A private mortgage lender has more flexibility than a bank in terms of who they lend money to. Borrowers who have bad credit, a high debt to income ratio, or are looking for a self employment home loan will have an easier time qualifying with a private lender than with a bank.

·      

      Pro: Geared towards investments and investment properties. If you are self employed, you know the benefit of having your money work for you to make more money. Private lenders have short term loans that are geared towards investment properties and fix and flip houses.

Once you evaluate the pros and cons, it is easy to see that in many cases, a private lender is the best option for your self employment home loan. Like all brokers, private lenders have to be licensed and they do have guidelines to follow to protect you and your investment. As long as you know that you will be able to make your monthly payments there is relatively low risk and a high reward for the self employed borrower.

Once you are ready to risk less with the best private lender, call us at Level 4 Funding to start your loan process today.

Stop waiting for a bank to give you the home loan you need. Take matters into your own hands and make your dreams come true today!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Self Employment Home Loans: A Win-Win for Business Owners

If you are self-employed, a self employment home loan might be a good option for you to purchase an investment property. Contact a mortgage broker to learn more about your options and loans today!

 If you are self-employed, you know the benefits of having your money work for you. One relatively easy and painless way to invest is with real estate. Although there have been ups and downs, experts agree that real estate investing has been overall stable and a way to increase your assets. Real estate has consistently appreciated in value over time and since it is a physical investment, you always have something to fall back on, even if the value goes down.

Although real estate investing may have many perks, it can also present unique challenges if you are self-employed. Since you own your own business, you can take advantage of many tax write offs that will save you big on your taxes. Everything from your office space to your paper clips are tax deductible. These deductions can make it look like your business is not making as much money as it actually is, and in some cases it may even look like you lost money.

While normally having a negative income stream is not a problem (as long as it is temporary, if it goes on too long, the IRS may object), it can present challenges when you are looking to make a real estate investment. This is especially true if you already own a property that you use as a primary residence. The bank may take one look at your tax returns and debt to income ratio and send you to the door, empty handed.

Being rejected for a loan can sting, but do not be discouraged. Instead, say good bye to the bank and hello to a licensed mortgage broker or private mortgage lender. Brokers and private lenders have access to different self employment home loans than banks do and can often work with you around mortgage requirements to find a loan to fit your needs. There are many options, especially if you are looking for a short term investment property like a fix and flip or short term rental.

3 Types of Self Employment Home Loans That Can Help You Make Money

 Once you have found a mortgage broker or private lender, you will be given many different self employment home loan options. Like anything else in life, it is important to remember that all loans are not created equal, and the best loan for you will depend on your ultimate investment goals. A few loans to look into are:

1. Hard money loans. A hard money loan is a great self employment home loan if you are looking for a short term investment. A hard money loan is not backed by a bank but instead by an equity firm or group of investors. They evaluate the property you are purchasing based on its investment potential. This makes your income or other debts less important because their investment is protected by the physical collateral of the property in question. Once they decide a property is a sound investment, they give you the money and you pay interest on it. The interest rate is usually pretty high so a hard money loan is best used as a short term loan to fix up a property and sell for a profit quickly. Once you sell the property, you repay the investors and any additional income is yours.
2. Adjustable Rate Mortgages. An adjustable rate mortgage is a good option for a longer term investment. An adjustable rate mortgage or ARM has an initial fixed interest rate that is usually very low. The low interest rate means lower payments so it is easier to qualify for, even if you have other mortgage debt or a low income due to business deductions. After a period of 1 to 7 years, the rate resets to a higher rate and your payment goes up. An ARM is a good option if you are going to rent out a property for a few years or do a long term fix and flip. An ARM can also be a good option if you anticipate your income increasing and will be able to refinance before the rate resets.
3. Stated income mortgages. A stated income mortgage does not use W2’s and tax documents to verify your income but rather goes by what you state it is. This can be a good option if your taxable income and actual income are vastly different. Just keep in mind that you may pay a higher interest rate and it is important to not over-extend yourself.

With a variety of self employment home loan options, don’t let a bank keep you out of the property investment market. Call a mortgage broker and get started today!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Arizona Bridge Loans: Do the Benefits Outweigh the Risks?

Arizona bridge loans are gaining in popularity as a short term loan options. Like any loan, there are certain inherent risks and benefits. Knowing how to analyze your loan will help you decide if it is a good option for you.

A bridge loan can be the

missing piece of your home

buying puzzle.

Arizona bridge loans are short term loans used when a borrower who has not sold his current home wants to purchase a new home. These loans work to bridge the gap when the borrower plans to use proceeds from the original home as the down payment on his new home. The bridge loan is secured to the original home, the one that's on the market. The funds from that loan are used as the down payment for the mortgage on the new home. 

There are no strict guidelines when it comes to Arizona bridge loans so credit score and debt to income ratio are not usually factors that will automatically disqualify you. This is good news for borrowers with less than stellar credit or who may have a high debt to income ratio once they purchase their new home. Instead, bridge loans are based on a few different factors, including how likely it is that you will sell your current home quickly, and whether or not you can make both mortgage payments for a short time if it becomes necessary. If you default on a bridge loan, the lender has recourse to get their money back using the property you have on the market because it is the one that secured the loan.

The Risks and Benefits of Arizona Bridge Loans

There are several risks that are associated with bridge loans. Like any loan, they are not entirely safe and can lead to some negative consequences if you don’t fully evaluate their terms, conditions, and rates. First and foremost, Arizona bridge loans have fees associated with them. Generally there is an administration fee of about $750, an appraisal feel (for your current home) of about $350. Once notary fees, wire fees, origination fees, and any other lender fees are added in, a bridge loan will end up costing the borrower about $2,000 to obtain. This may seem like a lot, but if is the difference between buying your dream home or losing out, many borrowers find that the fees are more than worth it. Especially since it is much easier to come up with two grand for a bridge loan than it is to find $20,000 for a down payment if your current home has not sold.

Another risk to Arizona bridge loans is high interest rates. Most short term loans are inherently more risky for the lender. You will pay extra for that risk meaning you will have a higher interest rate. Interest rates fluctuate based on the prime rate and how much you need to borrow, but typically speaking the interest rate on bridge loans is usually higher than a traditional home mortgage. You can avoid paying high interest rates by selling your home quickly and paying back the loan as soon as possible.

Along with the risks, there are also several benefits to Arizona bridge loans. Many loans offer terms that allow you to skip the first few months of payments. If you can sell your home during this time, you can avoid paying any interest at all on the loan. In addition, you can use extra proceeds from the loan to do remodel work on your new home and put your own personal stamp on it.

Also, bridge loans allow you to put your current home on the market quickly and without restrictions. Potential buyers will not need to schedule showings because the home will be vacant. A vacant home is easier to show and usually sells more quickly due to ease of access. You can also look into staging your home to give you an extra advantage. And without your family living there, it will be easier for new buyers to picture themselves living in the home.

Bridge loans are also usually fairly easy to qualify for and have flexible underwriting guidelines. This makes them an ideal loan for someone who needs cash for their new home fast.

Call an Arizona mortgage broker or private lender to get started on a bridge loan today.

Once you are settled in your new home, you will be happy that you chose to use Arizona bridge loans to help you get cash fast and with little hassle.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

5 Things to Consider If You Need a Self Employment Home Loan

If you are self-employed, you may have difficulty qualifying for a traditional mortgage. However, don’t be disheartened, there are many self-employment home loan options that can help you find the loan you need to buy the home you deserve.

There are many perks to being self-employed. You get to be your own boss, decide your own hours, create your own dress code, and in many cases, answer only to yourself. There are also a host of legitimate tax write offs that can make owning your own business more lucrative than punching a time clock. Everything from home office space to computers to office supplies and sometimes even meals are tax deductible. This can greatly lower your tax burden and help you keep more of your own hard earned money.

However, while many of these tax deductions can be huge benefits come tax time, they can also make it difficult to qualify for a home mortgage. For many business owners, there taxable income and what they actually make can be very different, with the amount that is taxable being relatively low. In some cases, business deductions may actually make it look like your business is in the red when in reality you are making a comfortable income. When you go to buy a home or investment property, this can become a big liability. Many traditional banks will look at your tax returns and give you a loan that is significantly smaller than what you need or can afford. Or, even worse, you may be denied a loan altogether based on your tax returns.

For many business owners, this can be a discouraging experience. You spent years of your life building your business and your personal brand, only to be told that it can actually be a liability. Do not lose hope. While many traditional banks may have their hands tied, there are several self employment home loan options and programs that can help you get the home loan you need.

How to Get a self employment home loan

 If you find yourself in the situation of needing a non-conventional loan due to your self employment status, you need to get organized and find the right company to help you secure your loan. Here are five things to consider when you are in the market for a self employment home loan.

1. Find a mortgage broker and private lending company. Banks are hard to deal with. A mortgage broker will work for you to find the loan that you deserve. A mortgage broker can help you even when a bank has already said no because he has access to multiple lending institutions and loan types whereas a bank can only give out its own loans. A private lending company can also be useful because they can give private investments that banks are not able to offer.
2. Get your financial ducks in a row. Make sure you keep meticulous records and inventory to give a clear picture of what your cash flow looks like.
3. Consider separating your business and personal finances. This way even if your business is in the red due to expenses, your personal income is intact. Pay yourself like you would any other employee. This may mean that you end up paying more in social security taxes or personal income taxes, but may end up being worth it.
4. Look into alternative loan types. Hard money loans, adjustable rate mortgages, FHA loans, and private capital loans can all be good options for self employment home loans.
5. Be persistent. You may hear no a few times before you hear yes. Keep trying. The right loan is out there.

When you are ready to take the plunge and learn the benefits of a self employmenthome loan, call us at Level 4 Funding to get the process started.

Our knowledgeable and friendly staff can help you every step of the way. You will be glad you called. We look forward to the day the title company hands you your keys to your new home.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Arizona Tel:  (623) 582-4444 
Texas Tel:     (512) 516-1177 
www.Level4Funding.com

NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027