When You're the Boss…..Loans Can Be More Difficult
If you run your own business it can be very difficult to get a refinance right now even if you make a lot of money. A recent article in the Chronicle tells the story of two Bay Area professionals who with 300K in combined income could not get a refinance. Also, be aware that if you have two loans, and you refinance one, the other will have to provide a subordination. Due to processing backlog, this can take eight weeks or more. So make sure you work with somebody who can freeze your rate and get extensions for you at no cost.
One way around the self-employment is have regular payroll through a service like ADP and just get a regular paycheck like your employees do. You might have to do a C Corp or LLC formation to make this work.
(Undocumented income makes it hard to get a loan - Thursday, July 9, 2009, Sfgate.com)
