Mortgage Nightmares: Dodd Frank Regulations, 1 out of 2 Applications are turned down

October 24, 2018


The impact of over regulating the mortgage industry and the welcoming back of the Sub Prime Industry that is now called Non-QM.



Was your mortgage application denied because you are self-employed? I'm guessing you just wasted a credit inquiry and probably 3 to 50 hours of your valuable time! Talking to well... a bunch of awful salespeople that have 5 Yelp stars, most not from this century. Okay, maybe it's not that bad out there in the world, and perhaps you got a super friendly modern salesperson that made you feel happy and safe. I don't know about you, but most people I have encountered in my thirty-six years on this planet, don't enjoy people undervaluing their time and not being honest from the start. If you are reading this you most likely just went through mortgage hell.


First off, this denial most likely does not mean you don't qualify to get mortgage financing; it just means you did not apply for the right loan. Business owners are not on the same financial scope as wage earners. Therefore you need a specialist that has programs that cater to the Self Employed and can navigate you through the regulations. For the same reasons you shouldn't get your taxes done at H&R Block if you are self-employed, is why you shouldn't use Quicken Home loans, Bank of America, or any NMLS lending company. If you are a business owner, you need to understand the difference between NMLS lenders and NON-QM lenders and the advantages and limitations being self-employed presents in the Over-Regulated NMLS Mortgage Hell.


Hi, my name is Phil Hills, I am the Mortgage Broker and Owner of The Sound Mortgage Brokers LLC.  We only work with Business owners and Real Estate Investors.  We can get your loan fully underwritten and approved within 4 hours of application and a credit closed in as little as three days in 36 states. We specialize in mortgages for business owners with an emphasis on the utilization of the 1031 tax exchange, fix and flips with a 3 to 12-month payoff and long-term buy and holding of rental properties.


Common reasons for getting denied by the retail and mortgage banks are a debt to income ratios, asset seasoning, recent or existing bankruptcy, past credit issues or anything that needs an extra explanation.  I have been in the mortgage industry for 15 years and have worked for many large banks and mortgage companies before becoming a Broker. The number one reason for loan denial is a debt to income ratios. With many like myself who are Self Employed, getting financing is quite the challenging subject. Business owners have many legitimate business expenses that can and should be written off on income taxes. But by doing so, you prohibit the ability to qualify for loans because of income. 


Now for the solution, first I would like to point out, I am not talking about "limited Document loans, Light document or bank statement loan" programs. The light doc loans have a high underwriting turn down ratio because they still need to verify large deposits. Therefore, I recommend staying clear from the limited and light doc programs.


Nor is it Hard Money.


So what's the answer? The answer is easy, sometimes too easy! I also want to say these are not just wealthy individuals that are lending private money. The Sub Prime Mortgage Industry bouncing back, and the lenders are Wholesale Lenders. So here it is!


NINA, No income No Asset Verification. I specialize in all aspects of mortgage from Qualified-Mortgage to Non-Qualified Mortgage and is one of the many reasons why closing in 3 days is possible. For the Pro Investors, we have no limit of how many mortgages you can personally have. As a broker, we have many other mind-blowing programs and connections of which can assist in expanding your real estate portfolio. 


Now for some fun facts. Lenders reject about 1 in every two applications they receive to refinance a mortgage, regardless of what your FICO Score is, according to the Mortgage Bankers Association. About 30 percent of purchasers who apply for a mortgage are turned down. These are loan denials after the Loan Officer did a Pre-Approval, got a mutual sales contract, submitted into underwriting, completed an appraisal, title, income verification, asset verification. Most likely 60 to 90 days of endless promises, only to get a hurtful untimely No! Ultimately you lost the property on a purchase and or didn't get the cash out you needed for a refinance, and went through the ultimate emotional roller coaster.


Knowledge is power and choosing your financial partners is vital to your business success and personal wealth.


Curious if we can work together? Want more information on this new, up-coming market? I ask you to reach out to me and ask away! I'm available via my cell phone or email.


Can't wait to hear from you.

All the best!


Phil Hills


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