Avenue Mortgage, LLC

NMLS #1115220

Navigating Mortgages as a Self-Employed Professional

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Securing a mortgage as a self-employed professional can be more challenging than for traditional W-2 employees, but with the right preparation and documentation, it is entirely achievable. Here’s a guide to help you navigate the process:

  1. Document Your Income
    Lenders need to assess your financial stability and income consistency. To do this, you’ll need to provide:
    • Tax returns for the past two years
    • Profit and loss statements
    • Bank statements
    • Client invoices or contracts
    • Consistency is key, so showing steady or increasing income over time strengthens your application.
  2. Manage Your Tax Returns
    Many self-employed individuals minimize their taxable income through deductions, but this can reduce the income lenders consider when evaluating your mortgage application. It’s essential to strike a balance between tax savings and showing sufficient income for loan qualification.
  3. Boost Your Credit Score
    A strong credit score can offset some of the challenges associated with self-employment. Pay down debt, make timely payments, and avoid opening new lines of credit before applying for a mortgage.
  4. Increase Your Down Payment
    A larger down payment can make you a more attractive borrower. It reduces the lender’s risk and can help you secure better interest rates.
  5. Work with a Mortgage Professional
    Partnering with a mortgage originator who understands the unique needs of self-employed borrowers can make a significant difference. They can help you find lenders that specialize in working with non-traditional income streams.

While obtaining a mortgage as a self-employed professional may require additional effort, proper documentation, financial management, and the right guidance can help you achieve your homeownership goals.

What You Need to Know About Refinancing a Reverse Mortgage

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If you have a reverse mortgage, you may be wondering whether refinancing is an option. The good news is that yes, you can refinance a reverse mortgage, and doing so may offer financial benefits depending on your situation. Here’s what you need to know about refinancing, including reasons to consider it, eligibility requirements, costs, and key factors to keep in mind.

Why Refinance a Reverse Mortgage?

Homeowners refinance reverse mortgages for various reasons, often to improve financial flexibility or access more equity. Common motivations include:

Accessing More Equity – If your home’s value has increased since you took out your reverse mortgage, refinancing can allow you to tap into additional funds for home improvements, medical expenses, or other financial needs.

Lowering Your Interest Rate – If market conditions have changed and lower rates are available, refinancing may reduce costs over time, improving your financial outlook.

Adding a Spouse – If you’ve married or have a partner living in the home, refinancing may allow you to add them to the loan, ensuring they can remain in the home if something happens to you.

Changing Loan Terms – Switching from a variable rate to a fixed rate may provide more predictability and stability in your financial planning.

Eligibility Requirements

Refinancing a reverse mortgage involves meeting specific criteria, including:

Home Equity – Lenders typically require at least 50 percent equity in the home.
Age Requirement – Borrowers must be at least 62 years old.
Financial Assessment – Lenders review income, credit, and financial obligations to ensure affordability.
Tangible Benefit – The refinance must provide a clear financial advantage, such as increased funds or lower costs.

Costs and Considerations

While refinancing can be beneficial, it’s important to factor in the costs:

Closing Costs – Fees may include lender charges, title insurance, and attorney fees.
Appraisal Fees – A new home appraisal is required to determine current equity.
Loan Origination Fees – Some lenders charge origination fees, so comparing offers is essential.

Is Refinancing Right for You?

Before refinancing, consider your long-term goals. Will you stay in the home long enough to recover the costs? Does refinancing provide significant financial benefits? Consulting with a mortgage professional can help you make an informed decision.

Refinancing a reverse mortgage can be a smart strategy when done for the right reasons. Whether you’re looking to access more equity, secure a better interest rate, or ensure a spouse’s financial security, understanding your options is key.

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Equal Housing Lender


100 Independence Place, Ste. 308
Tyler, TX 75703