Home Equity Loans for the Self Employed

A lot of the time self employed business owners, especially newly self employed business owners, have trouble proving income so you will often hear the term stated income or stated income home equity loans for recently self employed.

How does home equity loans work for the self employed?

If you are self-employed, you will go through slightly different process when filling out an application for an equity loan than most borrowers. Lenders often require that the self-employed supply at least “three proof of income” receipts. Therefore, if you are self-employed seeking home equity loans, you may want to know that brokers online specialize in various types of loans, including self-employed loans where no “proof of income” is required. This is sometimes called stated income loan. The majority of borrowers employed are obligated to prove “written evidence” of employment, which includes check stubs or tax returns.

What do I have to prove as a self employed person to get the home equity loans?

As a rule, self-employed borrowers must have worked two years or more to receive a loan. Few home equity lenders often send letters to the employers for proof that you work, and since you are self-employed, this is not possible.

Today, lenders are making it easy for the self-employed, since scores of individuals today are self-employed. Many lenders will offer competitive rates to the self-employed to help them get ahead of the game. You may be required by few lenders for home equity loans to prove with audited accounts showing three years of work history. If you do not have this proof, the lender may require a letter of confirmation from your accountant. However, with the wake of the subprime problem in the US, lenders are also tightening rules on lending to self employed individuals.

Home equity loans for small businesses

If you are searching for a home equity loan and are running a small business, make sure you supply the facts to the agent where you intend to get the loan. The lender will review the details and search
out the market for loans available to the self-employed. Few lenders will offer self-employed personal loans in connection with the mortgage loans. The self-employed loans often end with $5000 cash, but the lender may feel that you business has potential; thus the lender is helping you find a way to increase your income.