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How do I qualify for a home equity loan if I'm self employed?

Portland, OR |

I want to take out a home equity loan, but am also self employed. Will I have a hard time qualifying? What kind of documents will the lender look for in a case like mine?

Attorney Answers 3

Posted

Self employed persons often have a more difficult time verifying their financial condition. There is no absolute standard, and the best approach might be to start contacting some lender or mortgage brokers to discuss their requirements and your financial situation.

This comment is general in nature and is not intended as legal advice. It does not create an attorney client relationship and obviously is not confidential. You should contact an attorney in your area who can review with you all of the relevant facts and give you specific legal advice.

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Posted

Generally, the lender will want proof your last three years income sufficient to repay the loan with interest over 5 years. They will expect to see your income tax returns supporting the income.
Depending on your credit score and the income tax returns, it may not be difficult to qualify for the loan.

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This is not a legal question. You need to start calling and talking to lenders to find out. I can tell you that self employed people can and do qualify for home equity loans but it is usually based on showing a history of steady income so recently employed people, whether self employed or salaried generally have more trouble getting credit. Best to start with the loan department of you bank if you have had the account for a while. At least you have some history with that bank that might help.

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