Hi, I wanted to provide some feedback here in case this forum was read later by someone else looking for the same type of loan.
In general, there are 2 types of loans in the US - "Government" and "Portfolio".
"Government" based loans come from places like Fannie Mae/Freddie Mac, FHA, USDA, VA, etc. I'm lumping these together just to drive that these loans are regulated by some type of governmental agency. And usually when a federal agency regulates loans, they require federal tax returns to qualify. These loan types usually carry the best rates, have down payment assistant programs, are 30 year fixed, etc. If we can qualify, these are the loans to seek first. It's hard to show how they calculate income based on tax returns in this limited setting but it is entirely possible to qualify a self-employed person for these loan types.
"Portfolio" loans are loans that come from the bank's own portfolio of money. Meaning, money that is not controlled by an outside government agency. Sometimes banks call these commercial loans but whatever the bank/lender calls it, just think that the bank itself decides on who qualifies. Sometimes a bank will create a loan for someone in mind (thus, "Bank Statement" loans, because for self-employed persons they just show bank statements to qualify) and sometimes the bank just has money to lend to people they prefer/like (for example, "asset" based loans, for people with significant assets with the bank). There are banks out there that will absolutely just send you an excel spreadsheet to complete and say - "your approved". However, since there are 15,000 different lenders in the US, that means there could be 15,000 different options. That means, a lot of calling around to different banks to find a loan that might fit your specific need.
In general, most portfolio loans in the DFW area are a 20 year Adjustable Rate Mortgage. There are, of course, exceptions to this since each bank will make it's own decision.
If someone is buying their own personal home, they should likely expect 10% down for a "portfolio" style loan (again, exceptions are possible but that should be the number to expect). There won't be any down payment assistant programs for these loan types since those programs are for the "government" types of homes. For investors, you should expect 20% down for "portfolio" types of loans on single family properties (as a comparison Fannie/Freddie can use 15% down).
My company has lots of different loans and most of our portfolio loans are 30 year fixed rates but as investors I would encourage you to always have multiple lenders at your disposal. If you have any questions on this feel free to reach out!
Thanks!
