My adult son and his buddy since middle school have been roommates, sharing an apartment. Their lease was up this fall so they decided to take advantage of the tax credit and low prices. They made an offer on a house and it was accepted. How exciting for every one! Except me 
.
I didn’t want to be a wet blanket, but I knew the chances of them getting a loan were slim. I tried to explain this to the kids without being a total “budinsky”. Between them they make well into 6 figures, BUT at least 75% of that money gets paid to them on a 1099. If you don’t understand the significance of this, this is exactly why you need to get a lender on your side when you are trying to sell your own house! Lenders HATE to give loans to the self-employed.
Some lenders lie. They will say anything in the hopes that they can get your business. Their lender insisted from start to finish there would be no problem getting a loan. (I knew better.) The day after Thanksgiving, two days after they were supposed to settle, they get the bad news – no loan!
The sellers had already moved out. Yikes. My son and his friend HAD to be out of their apartment and quickly moved 
into his friend’s parent’s house. Double yikes.
Onto phase two. My son’s friend found another lender. (Not mine, again.) They are “pretty sure” they can get a loan next month. Meanwhile about 10 people’s lives have been totally disrupted. The sellers have one small child and another due any time. And it’s the week before Christmas.
Please put yourself in the seller’s shoes. They have two mortgages. They have a vacant house in the middle of winter they have to heat and worry about. We had 2 feet of snow yesterday they had to go shovel. Their life has been on hold for months. They can’t market the house to someone else because the contract is still binding. Even if they could, they have now entered the WORST time of year to sell a house.
Did I mention, that this wasn’t a for sale by owner house? Both parties, buyer and seller had realtors. I have to laugh when I see realtors saying how much FSBO sellers are risking by not using them and how much trouble they will save you. Right.
What lesson can YOU take to the bank here when you are selling your own house? Don’t believe a lender that you don’t have a relationship with and doesn’t have your best interests at heart. Be VERY leery about selling to a buyer that is relying on self-employment income.
I hope to come to you later and have a happy ending to this story!
Meanwhile, have a wonderful holiday. Stay warm and stay well.
