Home Mortgage Loans

Using the equity in your home as collateral can help fund commercial operations.For most small business owners, utilizing the equity in their home for business needs is a major decision that requires a great deal of research. Financing a newly formed business venture can create an added level of complexity for this process and may be intimidating for first-time entrepreneurs. Home mortgage loans and home equity lines of credit can be a great source of financing for business operations, however, they require a significant amount of documentation, including the following:

• Two years proof of income through tax returns or pay stubs
• Two months of bank statements showing funds available for use
• Appraisal of the home for valuation purposes
• Verification of employment
• Estimates of total costs and amounts due at closing
• Proof of hazard insurance (or intent to obtain hazard insurance)
• Preliminary title report

In some cases, further documents and information may be required depending on the specific situation of the borrower. For married couples or shared ownership arrangements, this information must be verified for all parties to the home mortgage. The amount of the down payment in relation to the size of the requested home mortgage loan will also be considered; in general, individuals with less than perfect credit may be required to put down a greater proportion of the loan as a down payment in order to be approved for a loan for home mortgage purposes.

Self-employed individuals must verify their incomes in an alternative way in order to obtain loans for home mortgages or a home equity line of credit (HELOC). Typically, this verification can take the form of a notarized letter from a reputable CPA or a business license that demonstrates at least two years of continuous employment in the applicant's field. In some complex cases, business owners may need to provide additional financial information in regards to business operations and their recurring business and personal cash flow to service the home loan for business purposes. Bank statements may also be used to verify this information to the satisfaction of the home mortgage lender.

CNF Exchange offers in-depth assistance in applying for home mortgage loans and home equity lines of credit for small business owners needing to utilize the equity in their residence to fund their business’s operations. Especially for self-employed individuals and small business owners, CNF Exchange can provide valuable help in navigating the home mortgage application process successfully.