For agents
Six buyers who get told no for the wrong reason
Every agent has watched a solvent buyer get declined and assumed the deal was dead. Usually it was a documentation problem sent down the wrong route. These are the six patterns worth recognising early.
Two years self-employed with a small net profit
Almost always a bank-statement or profit-and-loss file rather than a decline. If a lender has looked at the tax return and stopped there, they have looked at the wrong document.
Bank statementsPaid on 1099s by several clients
A CPA-prepared statement usually prices better than deposits alone, and takes less time to produce than most people expect.
Profit and lossRetired, comfortable, "not enough income"
Asset qualification. The divisor the programme uses, not the size of the account, is what decides the answer.
AssetsBuying in an entity, or holding several properties
A DSCR file, underwritten on the property. The personal return stops being the obstacle.
Rental incomeA very good year and a thin one on commission
Averaged over 24 months if the trend is up. Worth knowing before your buyer prices a house on the good year.
Paystubs and W-2sSeasonal income, four heavy months
Twenty-four months of statements rather than twelve, and reserves shown. A twelve-month file for a seasonal borrower is a file that goes wrong late.
Bank statementsThe question to ask
Three words that save a fortnight
“How are you paid?” Not “what do you earn” — how it arrives. Salary, deposits, a statement your accountant produces, savings, or rent. That one answer decides the programme, the documents and roughly the price, and it takes ten seconds at the first viewing rather than three weeks into a contract.
The second question, if the answer is anything other than salary: “has anyone looked at your bank statements rather than your tax return?” A surprising number of declines come from a lender who never got past the return.
- Paystubs and W-2sThe straight strand. Salaried and hourly income, evidenced by paystubs, W-2s and a verbal verification of employment.
- Bank statementsTwelve or twenty-four months of deposits, with an expense factor applied. Built for owners whose tax return is written to minimise tax, not to qualify for a loan.
- Profit and lossA CPA-prepared profit-and-loss statement, sometimes with 1099s alongside it. The shortest route when your accountant already has the numbers.
- AssetsNo income used at all. A verified pool of liquid assets is divided across the term to produce a qualifying figure. Common for retirees and for people between ventures.
- Rental incomeThe property qualifies, not you. Market rent is compared with the full housing payment to produce a debt-service coverage ratio.
Demonstration form
Send a scenario over
On a working site an agent would describe a buyer here and get an answer about which route the file is on. Here the form validates and stops.