Mortgage Guidance for the Self-Employed

Yes, you can get a mortgage if you’re self-employed, but it’s challenging in the age of Covid-19. Guidelines are changing monthly as the crisis continues, but the following requirements are generally true:

Work history: According to USnews.com, you’ll need a two-year employment history. Fluctuations in earnings are acceptable as long as you can show stable or increasing income. A shorter history may be okay if you’ve been employed in the same industry for a period of at least two years.

Cash reserves: If the worst happens and your business declines, you must show enough cash on hand to pay your mortgage regularly and on time.

Credit history: You’ll need a high credit score and an income to debt ratio of 43 percent or below, depending on guidelines. Lenders carefully check how you use revolving credit, other outstanding loans, and payment histories.   

Documentation: Supply your ID, your personal and business tax returns for two years, earnings and bank statements, business name verification plus evidence of business such as a web site, invoices, etc., license if applicable, list of debts and expenses, and payment verification for your home’s rent or mortgage.

Loan requirements are fluid, so contact your lender to learn the latest guidelines.

Should You Ask the Seller to Pay Your Closing Costs?

Closing costs are typically 2 to 5 percent of the sale price of a house. If you struggled to come up with money for a down payment, having to find thousands of dollars more may seem impossible. With some types of mortgages, the buyer must pay the closing costs, or at least a percentage. In many cases, however, the lender doesn’t care who pays those fees. Sometimes a seller is willing to pay some or all of the closing costs. 

Why Would a Seller Agree to Pay Closing Costs?
Sometimes sellers are in no rush to move, but in other cases they have a strict deadline; for example, if they need to start a new job. A seller may have already bought a new house and may be eager to sell the old one to avoid having to pay two mortgages at once. A homeowner who is motivated to sell quickly may be willing to negotiate to speed the process along. If you have been pre-approved for a mortgage and you offered to close quickly, the seller might agree to pay your closing costs.

Will the Seller Cover All Your Closing Costs?
Your mortgage lender may limit how much the seller gives you as a closing cost credit. The lender won’t allow the seller to give you a credit greater than the actual amount of the closing costs. 

If the seller can’t or won’t pay all your closing costs, you might be able to increase the sales price to cover closing costs, as long as the home will appraise for the increased price. 

Explore Your Options
Many people, especially first-time homebuyers, struggle to find money for closing costs and are unaware that having the seller cover some or all of those costs is even a possibility. Not all sellers are willing or able to pay closing costs, but many are. You won’t know unless you ask. Discuss the issue with your real estate agent.

Courtesy RisMedia

5 Budget-Friendly Home Upgrades You Can Complete in a Weekend

Just because you have a budget and short span of free time on the weekends doesn’t mean you can’t make some impactful changes in your home. Even the smallest changes can make a difference. Here are five home upgrades that you can not only complete in less than a few days, but also for less than $20.

Replace Old Hardware
Whether in your kitchen or bathroom, hardware can say a lot about your home’s style. Swapping out the handles on your cabinets and drawers can change the vibe of the room for just a few bucks. Removal and installation are a breeze—just unscrew the old and screw in the new. Look at your local hardware store, or even online, for inexpensive options that pack big style.

Replace Switch Plates
If you happen to live in an older home, chances are your light switch plates are outdated. Maybe it isn’t the style that’s old, rather the plastic is faded or discolored. Either way, it may be time to swap them out for new ones. For less than $20, you can get a new set of switch plates for an entire room, maybe even more. Get creative with paint and design each plate to compliment whatever room it will live in.

Weatherstrip Doors and Windows
Whether you’re pumping A/C in the summer or heat in the winter, if your doors and windows aren’t weatherstripped, you can end up with high utility bills. Simply stick your foam or felt weatherstripping tape along the tracks of your doors and windows. Though installation is easy, you may need a few basic tools, such as a drill or screwdriver. For more drafty areas, consider a low-cost door sweep.

Re-caulking the Bathroom
Check your bathroom tiles inside and outside of the bathtub, as well as all around it. If the seams are starting to crack or discolor, it may be time to re-caulk. To start, collect your tools, including the chalking, a bucket of water and rags. Consider a caulking tool for a more precise application. With less than $20 and a free afternoon, you can breathe new life into your bathroom while also keeping moisture away that can cause serious damage in the future.

Paint Doors or Trim
Of course, a fresh coat of paint on your walls or exterior can do wonders for curb appeal and transformation. But paint doesn’t need to be limited to just walls. Painting a fresh coat onto the trim around the interior doors and frames of your home can help to hide years of damage from pets, children and natural wear and tear. Or, paint your front door a bright or interesting color, adding a dramatic new flair to your home’s exterior. 

A weekend may not seem like enough time to upgrade your home, but with a few tools, some creativity and a crisp $20 bill, you can achieve plenty of your design dreams. DIY pro or novice, these budget-friendly home improvement projects will keep you busy all weekend long, maybe even less! 

Courtesy RisMedia

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