An important day is coming up on July 15—Tax Day.
Especially for all you 1099 business owners who have to write things off and claim certain things, you need to call us before filing your taxes this year. How you file your taxes in the next few weeks could have a huge impact on what you qualify for in the next year.
This is more important this year because there are opportunities out there to purchase that we didn’t have previously due to our extremely low interest rates.
One of the main things to remember is that you don’t need as much income as you once did to qualify for certain purchase amounts. Right now, if you put 20% down, there are loan products out there that only require one year’s tax return. For other products, if you put 3.5% down, you’ll need two years of tax returns.
To put this into perspective, by putting 3.5% down right now, getting a $100,000 loan requires an income of $16,000. For a $600,000 loan at 3.5% down, you’ll need a $90,000 income. And if you’re putting 20% down, you’ll need an annual income of $11,500 for every $100,000 of the purchase price.
If that seems low, remember that’s assuming no debt. That’s not always realistic, but as a baseline, that’s where they’ll start before working off your debt-to-income ratio.
That will get you something to think about and work toward because, again, with rates and inventories as low as they are, there’s no better time than now to get out there and take advantage of the market.
If you have any questions, don’t hesitate to reach out to us. We look forward to hearing from you soon!