Success Stories

Mortgages for Self-Employed: How an entrepreneur secured a Duplex in Miami

By Milo

September 22, 2023 3 min read

Mortgages for Self-Employed: How an entrepreneur secured a Duplex in Miami

Navigating the mortgage landscape as a self-employed individual can be a tricky challenge. The ups and downs of entrepreneurial income often confuse traditional lending channels. Picture this: an ambitious client, eyes set on a $650K duplex in Miami, but facing the complex process of securing a mortgage loan for self-employed investors.

Mortgages for the self-employed aren't as straightforward as those for salaried individuals. While most lenders dive deep into the predictable waters of standard income, the fluctuating currents of self-employed earnings can be trickier to navigate. A common question: do mortgage lenders use gross or net income for self-employed borrowers? Typically, it's the net income after deductions, which can sometimes paint an incomplete picture of one's true earnings.

In our client's scenario, the Debt-to-Income ratio (DTI) posed a significant obstacle. For those wondering how to calculate DTI for a mortgage: it's the ratio of monthly debt payments to monthly gross income. Given our client's business expenses, this became a skewed metric, making him an unattractive prospect for most lenders.

Enter Milo, recommended by a savvy realtor who knew our specialty in serving non-traditional buyers. Our solution was the DSCR loan, an instrument that emphasizes the property's cash flow rather than the borrower's fluctuating income.

With the duplex's promising revenue potential and our client's ample assets, we put together a DSCR loan structure boasting a 50% Loan-to-Value (LTV). This meant he had a solid stake in the property and a comfortable positive cash flow.

So, if you're self-employed and pondering how to calculate DTI for a mortgage, or exploring mortgages for self-employed professionals, remember: while the path may seem intricate, partners like Milo exist to transform challenges into success stories.

For the entrepreneurial spirits looking to invest in the real estate world, Milo stands ready to guide. Let us craft your self-employed mortgage story. Apply Now.

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The opinions expressed in the Blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.


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