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Evaluating and using Tax Returns for Mortgage Financing (Part One)
Evaluating and using Tax Returns for Mortgage Financing (Part One)

Chances are you have heard how the mortgage lending environment has changed and that it's becoming more challenging to obtain mortgage financing.  While that is certainly the case, there are still options out there.  In this Part One series, we will discuss how lenders analyze tax returns for mortgage financing.
 
 
Many self employed individuals or folks with complicated tax returns may be interested to know what mortgage lenders look for in those returns in order to establish qualifying income.  While different lenders may look at some situations differently, I hope this will help to explain some "basics" in terms of what is evaluated in those tax returns for mortgage financing, for qualifying purposes.
 
In Part One of this blog, let's look at how rental income is analyzed.
 
When using tax retuns for mortgage financing, the typical rule of thumb is that the lender will want two current, consecutive tax returns.  If the most recent tax year has not been completed yet, and an appropriate extension was filed, they may possibly allow an older tax year.  And I cannot stress enough, that lenders will want the full ... more

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