My wife and I are looking to buy a new home.
My career is stable, etc... everything that looks good on a loan.
My wife started her own business after leaving a director level position in July of last year. Business is good/profitable and her income is almost identical to what it was before leaving, but our realtor's lender doesn't seem to be able to use her income.
The lender seems to be steering us toward NAF Cash, but that's not a product we've used before. Any opinions on it?

Will this be the same anywhere, or are there lenders comfortable with lending in these situations?

We qualify for the loan based on my income alone if we sell our current home, but we'd prefer to keep it and rent it out.

Based on what information you posted you cannot get a normal loan. Your wife preferably needs two years self employment documented by tax returns. Alternatively you could qualify her income on year for some programs. You have neither.

I looked at the NAF website and am concerned about they say the existing home has to be sold not retained. They appear to be a bridge lender which their are several offering the same buy now-sell later financing. But you don't want to sell so I would dig deep direct with their personal not some broker that buys lunch for your realtor. It maybe legit but get the terms directly from their employees.

There are some non traditional loans you may qualify for but I would need much much info and I promise their terms are ugly, for a reason.

Your best bet is to sell the existing home and get the best terms you can. You obviously don't want to hear that.

She will need 12 months of bank statments to prove the income and you will have to find a non qm lender who will accept 12 as some will want 24 months but it can be done. Rate will probably 1-2% higher than a conforming rate.
Here is one that could probably get it done


https://www.fnba.com/self-employed/

I have one that takes 12 but is exception based. So turn in the loan and they give a yea or nay. Probably around 9.5ish for 30 year fixed. And need 750 plus credit and some other requirements. At least 25% down.

Couldn't he move out of his house into a short term rental (not AirBnB, but say a 6 month lease), get his house rented out so the debt service is covered, then qualify for a new house based on his income?

New lease money is used in some cases but the numbers typically don't help much. It depends on the lender program but in the self employed mortgages other income like bank statements are what you go on.

I would try to get the deal without rental money but others can have better loans that is could help. It would need to be a full time rental though.

Your wife's income will be tough to use at this point. However, you mention you can qualify if you sell your house. if that is the case you can likely qualify once you have a lease on the property. Assuming that is the case our Buy before you sell (in this case buy before you rent but mechanics work the same) program would work. We are ok with higher then typically required debt to income ratio as long as after you sell (or rent in this case) your debt to income is acceptable.

Love to chat and see what we can do for you.

Related question, we're on year 4 of my business and I pay myself a marginal w-2 salary throughout the year with a large bonus at the end of the year.

How would this affect eligibility? I always heard 2 years returns for self employed but this 12/24 months of bank statements is news to me. The returns show a healthy amount of income each year, but by bank statements it's all at the end of the year.

TIA!

Self employed paying with W-2 is still self employed. So the tax returns for two years of probably both business and personal. Also need the 2's but the taxes are key. Yearly is divided by months so does not really matter if uneven income received.

Just remember business taxes could open up a bunch of questions so the loan office should get all those in the preapproval process and know what to look for.

You always want to do the bank statements loan as a last resort. They have ugly terms.

Thanks for the clarification!