I have a situation now where I am being rejected by lenders for a $170,000 mortgage when earning $160,000 per year. Since January I have been working as an independent contractor on 1099. I am being told that due to not having a tax history established as a 1099-based worker that they won't count it as income. I even have W-2s that reflect similar income for the previous three years.
Additionally, I currently have a mortgage with a perfect payment history, and a pending home sale that nets me a bunch of money.
I figured I would throw this out to the Hacker News community as there must be an abundance of ICs out there. Anyone know of lenders that will work with a situation like this? Anyone have a similar story?
Heck, if nothing else, this seems like an opportunity for startups?
I have done this myself, in fact I bought not only my personal homes while being a contractor I had bought investment real estate too. It was also weird because when I went from 1099 to my own business the first time it was harder to get loans again for a year or two, not impossible, just harder. Banks teach their front line teams to be conservative and reject anything that doesn't look like a traditional loan, unless of course you can skip those teams as the wealthy do. But every bank owns mortgage companies that do non-traditional loans, and mortgage brokers are the ones that are suited to get you a deal that works.
Don't be afraid of using a mortgage broker, they are not evil, they are not there to steal money or to raise your rates. They serve a real purpose and good ones can be a lifesaver.