Applying for a mortgage can be a relatively simple process if you’re a borrower with traditional income sources, but if you’re not the process can actually be a bit daunting. If you’re finding yourself overwhelmed, we’re here to help. We have years of experience finding creative financing solutions for our well-qualified applicants who don’t have the typical income verification documents, like self-employed borrowers. Getting a mortgage without a 5406-C IVES is definitely possible!
Alternatives to the 5406-C IVES Form
Let’s say you can’t use a 5406-C IVES (Income Verification Express Service). The 5406-C IVES form is typically used to request a transcript of a tax return directly from the IRS, which lenders use to verify income information provided by the borrower. If you aren’t able to provide the form for any reason, we can work with with other documentation instead of the 5406-C IVES to verify your income.
Direct Copies of Tax Returns
Instead of the 5406-C IVES, you can provide direct copies of your tax returns. Ensure you include all pages and schedules. Typically, we want to see tax returns for the last two years. You should have these documents available if you file your taxes, either electronically or on paper.
W-2 and 1099 Forms
W-2 forms for employees and 1099 forms for independent contractors can serve as proof of income in lieu of a 5406-C IVES. These documents show the income you earned from your employer or clients and are essential for the verification process.
Bank Statement
Recent bank statements can provide insight into your financial situation, showing your income deposits and overall financial health. Ensure these statements are complete and unaltered. We even have loan options that are qualified on your bank statements alone, looking at 12 to 24 months of statements to see your true income even if it’s not clearly reflected on tax documents.
Profit & Loss Statements
For self-employed individuals, providing a current year-to-date profit and loss (P&L) statement can be useful. This document, often prepared by an accountant, details your business income and expenses and provides an accurate picture of your current financial status.
Accountant’s Letter
If you are self-employed or have complex financial situations, a letter from your accountant detailing your income and confirming the accuracy of your financial records can be very persuasive.
Overall, we want you to see that we have the flexibility to offer approval based on a variety of verification methods. Don’t assume you can’t qualify, even if other lenders have said you don’t have the documentation they need. We have years of experience finding solutions for borrowers who are financially ready to invest, but don’t fit the mold.
4 Tips for a Successful Mortgage Application Without a 5406-C IVES
The application process can be involved and time consuming, but we have 4 tips to help you limit your stress and work toward a successful loan approval.
1. Stay Organized
Keep all your documents well-organized and easily accessible. This will make the application process smoother and less stressful.
2. Maintain Good Credit
One factor that all loan types have in common is the need for good credit. While we do have some wiggle room in some of our loans, the better your credit is the stronger your application will be. Avoid making large purchases or opening new credit accounts during the mortgage application process, as this can negatively impact your credit score.
3. Communicate with Us
We are on the same team, working together to help you buy your home. Keep open lines of communication with and respond promptly to any requests for additional information or documentation, so that we can do our job as effectively as possible.
4. Be Patient with Delays
Understand that the mortgage process can be lengthy and sometimes encounter delays that are out of our control and yours. Being prepared for this can help manage your expectations and reduce frustration.
Devin Stephens with Canmore Real Estate Group encourages hopeful buyers: “Even if it takes a few extra hurdles to get there, investing in real estate is one of the best decisions you can make for your financial future.”
Ready to learn more about applying for a mortgage? We are here to help. Contact us any time with your questions to learn more about reaching your goals in real estate.
