Tax Season Focus — Self Employed Borrowers

Tax transcripts are required on all loan files but are especially important for documentation when a borrower is self-employed. Transcripts come directly from the IRS and demonstrate that the tax returns provided for lending purposes are the same returns filed with the IRS. This proves that no fraud has been committed on the loan application.

As April 15th approaches, there can be delays in obtaining tax transcript verification. When calculating self-employed borrower’s income, we are required to average two years of income if the current year is higher, or use the lowest of the two years if the current year’s income is lower. If you have a self-employed borrower who needs to use their 2014 income in order to qualify, we will need the 2014 transcripts in the file prior to closing. Encourage your borrowers to file their taxes as early as possible in order to avoid delay!
Warning from the IRS!

There are many different tax scams going on across the country. The scam that has been receiving the most press this year is fake IRS phone calls demanding immediate payments, with a threat of jail time if the borrower does not immediately pay the ‘amount owed’. The IRS does not call individuals at home; they will send a letter first. NEVER give out personal information over the phone or send money to an unknown caller. Read more below on this and other tax and identity theft issues to be on the alert for!

Reach out to Wintrust Mortgage to determine your mortgage pre-qualification options, to learn more about pre-qualifying for a home loan as a self-employed buyer or for any other real estate and financial information!

Amy Tierce
Regional Vice President
We’re here to help you and your buyers do more, learn more and grow more!

Wintrust Mortgage is a division of Barrington Bank & Trust Company, N.A., a Wintrust Community Bank NMLS# 449042. Copyright © 2015 Wintrust Mortgage KO15031397