If you’re self-employed and thinking about buying a home, you’ve probably heard this frustrating line before: "You don’t show enough income to qualify.” But what if I told you that’s not always the case?
Here’s the reality: Traditional lenders rely on tax returns, but for self-employed individuals, those numbers don’t always reflect their true earning power. That’s where Portfolio Lending comes in.
Example: I recently helped an Uber driver who, after deductions, reported only $10K/year in NET income on his tax returns and didn’t qualify for anything. With a Portfolio Financing program that analyzes bank statements instead of tax returns, his qualifying income shot up to $97K/year—allowing him to secure the home he thought was out of reach!
This approach isn’t just for Uber drivers—it works for anyone self-employed who isn’t showing enough income on paper but is actually bringing in strong revenue.
If you or your clients are tired of hearing “no” from lenders because of the tax returns, drop a comment or send me a message. Let’s talk about how we can make homeownership a reality!
I tried it once, few days before closing lender made up some stuff about our occupancy and raised the rate. I’m sure @Adam.Youhanna wouldn’t let that happen, I just had a bad experience with it.
The difference in rate will depend on the borrower’s down payment and credit score for the Portfolio lending. Can differ by as little as 0.375% to possibly 3%.
Just closed a client, 760 credit score, 15% down payment at 7.875% PAR. Conventional loan was 7.25% on day of lock.
That’s not fun to go through. It’s not as smooth as a traditional transaction; I choose to work with a couple of lenders who do a lot of the underwriting up front so if anything comes up, it can either be addressed quickly or we can not proceed.
At the end of the day, it can be a matter of a denial via traditional loan vs an approval to be a homeowner.
