Articles by Dani Hernandez

Ask the Underwriter: Negative self-employment income? No problem… here’s how to exclude it!

Simply put the spouse first!
When co-borrower income that is derived from self-employment is not being used for qualifying purposes, the lender is not required to document or evaluate the co-borrower’s self-employment income (or loss). Any business debt on which the borrower is personally obligated must be included in the total monthly obligations when calculating the debt-to-income ratio.
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Ask the Underwriter: My borrower owes a federal tax debt to the IRS… Is this mortgage deal dead?

Here's how to close that loan
Question: My borrower owes the IRS approximately $16,000 for tax years 2016 and 2017. They have $20,000 in savings, but were hoping to use that money as a down payment to purchase their first home. Is there a way to get them approved without making them pay off the entire tax debt first or is this a dead deal until it is paid? And the answer is...
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