Are you planning to buy a new home in 2010?

Are you self-employed or do you derive a majority of your income from 1099s, rental properties, or business investments?

If so, you will want to meet with your mortgage consultant prior to finalizing your 2009 tax returns.

The days of “low-doc” or “stated-income” loans are long gone and will not be returning for the foreseeable future.  If you want to purchase a house in 2010 (or beyond), you are going to need to prove your qualifying income through two years of tax returns.

Many borrowers who are self employed, contract workers, or have large rental portfolios tend to be a bit more “aggressive” with their tax deductions.

Pushing the envelope or claiming tax write-offs that fall in the grey area of legal deductions may cause a borrower to depress their taxable income to a point where mortgage financing becomes unavailable.

If you plan to buy a home in the next three years, it is strongly recommended you have a conversation with your tax professional and your mortgage consultant.

In our new mortgage environment, borrowers may need to plan for buying a house years ahead of the actual purchase.  Paying a few extra dollars in taxes to the Federal Government now, may ensure you are eligible for a home loan when the right property becomes available.