HUD does have provison with FHA mortgages where the employer has changed the employee's method of compensation and they remain with the same employer.
FHA guidelines state: "Commission income earned for less than one year is not considered effective income. Exceptions may be made for situations in which the borrower’s compensation was changed from salary to commission within a similar position with the same employer.
A borrower may also qualify when the portion of earnings not attributed to commissions would be sufficient to qualify the borrower for the mortgage."
Fannie Mae has a simialr stance and their guidelines state "Fannie Mae generally requires lenders to obtain a two-year history of the borrower’s prior earnings as a means of demonstrating the likelihood that the income will continue to be received.
However, a person who has a shorter history of self-employment — 12 to 24 months — may
be considered, as long as the borrower’s most recent signed federal income tax returns reflect
the receipt of such income as the same (or greater) level in a field that provides the same
products or services as the current business or in an occupation in which he or she had similar
responsibilities to those undertaken in connection with the current business. In such cases, the
lender must give careful consideration to the nature of the borrower’s level of experience, and the
amount of debt the business has."
Bascially, there are possibly provisisons for someone in your situation sicne you received 1099 income in 2011. An explanntion letter from your company's HR Department would also be required for an underwriter to be able to make a determination.
Rodney Mason, NMLS #151088
Sr Loan Officer
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
Apply Online at http://www.rodneymason.com
Licensed in Alabama & Georgia
Prospect Mortgage offers a full selection of mortgage programs including:
Conventional | FHA | FHA 580-639 FICO | FHA 203K Renovation (Streamline & Consultant) | HomePath® | HomePath® Renovation | HomeStyle® Renovation | VA | USDA | GA Dream | Jumbo Financing
The bookeeper is not up on mortgage guidelines.
The only way to do it is to have two FULL years of the self-employment because they go off your gross, not your net.
How about getting a co-signer? You can (maybe) then go with an FHA or a Freddie Mac loan. Talk to your mortgage broker about that.