Getting a home loan on a self employed income is a bit more complicated than getting a home loan on a salaried income. Mainly because the salaried individual has a stable and steady income as opposed to a self employed individual. You need to be prepared to pay a larger down payment and produce documents to prove your income and business. First let us see the documents that you will be required to provide Residence Proof (telephone bill, electricity bill, rent agreement, passport), Proof of Age, Copy of Bank A/C statements for the last 6 months, Copy of latest credit card statement, Passport size photograph, Pan Card Xerox, Signature verification from your banker, Your business track record, Copy of audited financial statements for the last 2 years, Shop/Office license.
In this process you have to approach the lender of your choice. You may want to go to a bank in your area or a bank you have an account with. Many individuals like to consult the home loan officer at their own bank. One to one communication is always better to get the home loan process started. You can even go online and check out the different offers available to self-employed individuals and go on comparison sites as well to determine what type of loan suits your need the most.
Once you have met up with the loan officer you will need to provide your 2 years income tax returns. Lenders check your income and use it as the most important factor in determining your ability to repay the loan. Bankers even determine how much loan amount you are eligible for on the basis of your income tax returns. You will also need to provide your business financials like up-to-date balance sheets and year-to-date income statements, along with business tax returns which identify trends of growth or decline in your business. Lenders like to see whether or not your business will continue to provide you a stable income in the future.
Providing your personal income tax returns also can be of great help in getting you a home loan. Lenders like to see your personal expenses and income apart from your self-employment income. Income from other sources like a rent coming from some property or a spouse's employment, get you in a better position to be approved for a home loan. The growing recession has caused declining income for many self-employed people hence in such cases a second income makes the bank feel that you are in a better position to repay a large loan.
Always be truthful about the numbers that you provide when you are trying to get a loan. Don't ever fabricate the figures it is not only illegal but if you get caught it is certain that you will be denied the loan from each and every lender available.
In this process you have to approach the lender of your choice. You may want to go to a bank in your area or a bank you have an account with. Many individuals like to consult the home loan officer at their own bank. One to one communication is always better to get the home loan process started. You can even go online and check out the different offers available to self-employed individuals and go on comparison sites as well to determine what type of loan suits your need the most.
Once you have met up with the loan officer you will need to provide your 2 years income tax returns. Lenders check your income and use it as the most important factor in determining your ability to repay the loan. Bankers even determine how much loan amount you are eligible for on the basis of your income tax returns. You will also need to provide your business financials like up-to-date balance sheets and year-to-date income statements, along with business tax returns which identify trends of growth or decline in your business. Lenders like to see whether or not your business will continue to provide you a stable income in the future.
Providing your personal income tax returns also can be of great help in getting you a home loan. Lenders like to see your personal expenses and income apart from your self-employment income. Income from other sources like a rent coming from some property or a spouse's employment, get you in a better position to be approved for a home loan. The growing recession has caused declining income for many self-employed people hence in such cases a second income makes the bank feel that you are in a better position to repay a large loan.
Always be truthful about the numbers that you provide when you are trying to get a loan. Don't ever fabricate the figures it is not only illegal but if you get caught it is certain that you will be denied the loan from each and every lender available.
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