It's never been easy to get a mortgage if you're self-employed. But a recent analysis of mortgage data shows just how much harder it is.
Getting lenders to quote you a rate is tougher if you don't work for someone else, according to a report Thursday from real estate researcher Zillow.
Though they typically have higher incomes, put more money down and buy bigger homes, self-employed online mortgage shoppers got just six loan quotes from lenders for every 10 offered to borrowers who aren't self-employed, Zillow found.
"That's the first battle," said Erin Lantz, vice president of mortgages at Zillow."The second battle is actually getting through all the paperwork."
Regardless of their employment status, mortgage applicants today need to be prepared for a time-consuming paper chase. For a salaried worker, a batch of W-2 forms, pay stubs and bank statements will get the ball rolling. For the self-employed, the work has just gotten started.
"For a self-employed borrower, we have to look at two years of tax returns and if they're incorporated we have to look at a corporate return," said Amy Tierce, a regional vice president for Wintrust Mortgage in Boston. "So we're looking at way more a paperwork for the self employed borrower than we are for the salaried borrower. It can feel very onerous to keep supplying stuff."