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getting a mortgage loan when you income is commission

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  1. bugbig1 bugbig1 is offline

    Dayton, OH
    United States

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    Joined: Jul 05

    Oct 30th, 2007 (10/30/2007 10:46pm)

    here is a situation I have found myself in. submitted an application for a loan and received a letter that loan was approved. set a closing date and all that good stuff..... got a letter today saying they are not going to do the loan. the bulk of my income comes from commission and i only have 3 months from 2006 of commission type pay. Ive given all my info to another bank and they are going to see what they can do. has anyone else been in this type of situation and if so did you get the loan?
  2. BigJohn804 BigJohn804 is offline

    Midlothian, VA
    United States

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    Oct 30th, 2007 (10/30/2007 10:51pm) in reply to bugbig1

    did you get an approval... or did you get on approval pending being able to provide documented information required for the approval?

    My guess is the latter...
  3. dolphin13 dolphin13 is offline OT Vice MVP

    Chicago, IL
    United States

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    Oct 30th, 2007 (10/30/2007 10:51pm) in reply to bugbig1

    first off you have to answer some questions. What percentage are you able to put down? How is your credit history and do you have any credit card or other debt
  4. bugbig1 bugbig1 is offline

    Dayton, OH
    United States

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    Oct 30th, 2007 (10/30/2007 11:05pm) in reply to dolphin13

    i received a letter saying congrats you have been approved.... did the appraisel and all the paper work..........my credit...and income are not the issue.......even if my credit was perfect and was making 60,000 a year they would still not approve the loan because my work history as far as commission is only 3 months in 2006 ( if it was six there would not be a prob) and until I file taxes for 07 they will not even consider my income from commission for the last nine months
    Thread Starter
  5. dolphin13 dolphin13 is offline OT Vice MVP

    Chicago, IL
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    Oct 30th, 2007 (10/30/2007 11:07pm) in reply to bugbig1

    I just ask because with the right amount down and good credit you can get a no documented income loan
  6. dolphin13 dolphin13 is offline OT Vice MVP

    Chicago, IL
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    Oct 30th, 2007 (10/30/2007 11:08pm) in reply to dolphin13

    <H1 class=title>No Income Verification Mortgage Loans</H1>
    Many people, especially the self-employed, find it difficult to be approved for a loan because they can't prove steady income. A better option in cases such as these is a no income verification loan. Traditionally, no income verification mortgage loans require less documentation than traditional, fully documented loans.

    We offer no income verification loans for our customers at Downs Financial, Inc., because we believe that our customers should have options when they are looking to purchase or refinance a home. Traditional loans require you to submit W-2 forms, check stubs, gross income amounts and more. No income verification loans are ideal for self-employed persons who find it difficult to prove a consistent yearly income because of ups and downs in their industry or income from multiple sources.

    As well, no income verification loans are great for those who are in a time crunch. This is because the process doesn't require as much paperwork and therefore usually is quicker. You can apply online or give us a call at 1-866-745-5989.

    No income verification programs are riskier for the lender, so they usually come with a higher interest rate. For us, we are a direct lender, so we can determine how much interest we will charge our customers on a case-by-case basis. The great thing is, because it's our money, we can loan it to whomever we want at the lowest rates possible. We respect the self-employed and will always offer them the most affordable rates, by taking into account their current financial situation.
  7. bugbig1 bugbig1 is offline

    Dayton, OH
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    Oct 30th, 2007 (10/30/2007 11:13pm) in reply to dolphin13

    trying to do this without much down because I am a student working full time and really dont want to ask for help from family...its a 52,000 loan after closing costs. what type of deposit would i need?
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  8. bugbig1 bugbig1 is offline

    Dayton, OH
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    Oct 30th, 2007 (10/30/2007 11:17pm) in reply to dolphin13

    thanks i will be looking into it
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  9. ilovescotch ilovescotch is offline Mod of teh xfers

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    Oct 30th, 2007 (10/30/2007 11:17pm) in reply to dolphin13

    You don't need to go no income, you can go stated income, it will result in a better interest rate. It is unfortunate, but those are the typical guidelines when dealing with commissioned borrowers. So you really have 2 options.

    1. Look into a stated documentation loan. They will not require W2's, paystubs, etc. You still will be verifying assets. You can get the same rate you originally applied for, with slightly increased closing costs (usually 1/4 to 1/2 a point, or .25-.5% of the loan amount)

    or

    2. Take a higher rate now, like something higher then you were planning on. Get a rate that offers a rebate from the lender, to off-set some of the 3rd party expenses (appraisal, title insurance, closing attorney etc.). Then refinance after the first of the year, providing full documentation, using the money you have set aside now for closing costs, then.

    Whatever you do, please make sure there is no pre payment penalty.
  10. bugbig1 bugbig1 is offline

    Dayton, OH
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    Oct 30th, 2007 (10/30/2007 11:19pm) in reply to bugbig1

    thanks all for the input....now maybe i can get some sleep
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  11. ilovescotch ilovescotch is offline Mod of teh xfers

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    Oct 30th, 2007 (10/30/2007 11:21pm) in reply to bugbig1

    With the current market, I doubt you would be able to go over 95% financing with stated documentation, perhaps even 90%. Unless you have exceptional credit, like 780+, it is going to cost you more. Do you have anyone that would co-sign with you, that could provide additional income, non-occupying co-borrowers can be used to qualify you for full documentation, which results in optimal pricing.
  12. bugbig1 bugbig1 is offline

    Dayton, OH
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    Oct 30th, 2007 (10/30/2007 11:26pm) in reply to ilovescotch

    my understanding with a non occupying co signer it would cost me more because it would be vieewed as in investment property for the cosigner?
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  13. ilovescotch ilovescotch is offline Mod of teh xfers

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    Oct 30th, 2007 (10/30/2007 11:30pm) in reply to bugbig1

    not always, depends on location, as long as it is 50 miles from the non-occupants primary residence, it can be considered a second home (which gives the same pricing as primary). The only way it can be closer then 50 miles to the non-occupants primary home is if it is a vacation area (ski/beach/lake/mountain house etc.) So if you are living in the same neighborhood as the co-borrower, you might be SOL, but if not, it could be an option.
  14. dolphin13 dolphin13 is offline OT Vice MVP

    Chicago, IL
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    Oct 30th, 2007 (10/30/2007 11:36pm) in reply to ilovescotch

    WOOHOO I'M RIGHT.... I THINK

    Stated Income Loan / No Income Verification The popular No Income Verification Loan (NIV) also known as Stated Income - requires No W2's, No Pay stubs, No Tax returns, and No IRS Forms. Available to W-2 wage earners, 1099, Self Employed, and Retired.
    If you need financing but your income is difficult to prove or document then the answer for you is a Stated Income or No Income Verification loan. Review the Program Details for the available states.
    There are "3" types of NIV or No Income Verification loans for purchase or refinance that offer up to 95% financing explained below:
    Stated Income Verified Assets Loan: (SIVA) - Loan approval is based on your stated income, credit history, and verified liquid assets. The Verified Assets should be consistent with the income claimed.
    Stated Income Stated Assets Loan (SISA) - This loan features no assets being verified. You only state your income and state your assets on the application. This program carries a slightly higher rate because the assets are not verified. No longer available on Home Equity Lines or Fixed Rate second mortgages due to credit market.
    No Ratio Loans - Similar to the programs above except that no income information is provided or verified on the application.

    95% to $900,000 ( need 720+ score )
    80% to $1,500,000

    90% to $2,400,000

    80% to $4,400,000
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