Tag: Self-employed

Documenting Income from Sole Proprietor to LLC

Question: My client was a sole proprietor for the last 5 years.  In January of 2020 he formed an LLC.  How do I document his income? Answer: At a minimum, he would at least need one-year returns showing the transition. So, you would need at least the 2020 returns for the new ownership as an […]

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Fannie Mae – Updated FAQs for COVID – Updated September 17, 2020 and Freddie Mac – Updated FAQs for COVID – Updated September 24, 2020

Written by: Lloyd Rutherford, Staff Writer The COVID FAQs from Fannie Mae and Freddie Mac are huge.  It is important to keep up with how COVID related issue will affect your clients now and into the future. Rule Synopsis: The GSE’s (Fannie Mae and Freddie Mac) have updated their FAQ documents for COVID related (temporary) […]

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Fannie Mae Selling Guide Announcement SEL–2020-03 – Updated August 27, 2020

Written by: Lloyd Rutherford, Staff Writer The scariest phrase in mortgage lending today is “Self-Employed Borrower”.  The agencies have gotten hypersensitive to those who own their own companies during a pandemic.  Read through this article to hear a “true confession” and the resources you need to work with clients that are self-employed! Rule Synopsis: Fannie […]

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What Temporary Guidance Has Been Issued by FHA for Self-Employed Borrower Income?

Question: I am being challenged with a self-employed file and documenting it correctly.  What is needed in today’s COVID world? Answer: The requirements for the YTD P & L and the 2 months of bank statements are standard underwriting requirements. The only new COVID-related requirements for self-employed borrowers were recently issued in Mortgagee Letter 2020-23 […]

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FHA Mortgagee Letter 2020-24, Revision of Effective Date for COVID-19 – Updated Temporary Guidance for Verification of Self-Employment; Rental Income

Written by: Tracey Rumsey, Staff Writer This article highlights some important temporary guideline changes for FHA loans, especially for clients who are self-employed or have rental income. If you work with FHA loans this is a must-read! Rule Synopsis: Effective dates: Verification of business operations for self-employed borrowers and the rental income guidance is effective […]

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