Why Do Mortgage Lenders Ask Borrowers For a CPA Letter

[Gustan]

Thank you Ali. How about a little more details on the program you have, videos power point presentation. I will send blast this to all my contacts. Thank you

[Peter]

Gus and Ali have been a God send. Never have I worked with two more diligent and caring people. They make you feel like family.

[Gustan]

Peter, it is a pleasure to be working with you and Doreen @Peter.gun . I spoke with Donna yesterday for quite some time and went over the potential options on your pre-approval. The issue we have in the state of Florida is the homeowners insurance. I did try to get a hold of @Brent yesterday and texted him the property address but he was in meeting all day. I think we got the credit issue fixed thanks to @Ali but now we need to tackle the debt-to-income ratio situation. Here is the mortgage calculator where you can plug in the property info. Since it will be a manual underwrite, the maximum debt-to-income ratio will be reduced to 40% front-end and 50% back-end. If we can get the errors of Doreen off the credit report, we should get an approve eligible and the maximum front-end debt-to-income ratio would be 46.9% and back-end debt-to-income ratio would be 56.9% Per Brent, older homes in Florida, the homeowners insurance can go as high as $4,000 to $8,000. Many states, homeowners insurance is not greater thant $600 to $1,000.

Here is the mortgage calculator

http://www.gustancho.com/best-mortgage-calculator

• This reply was modified 2 months, 3 weeks ago by  Gustan. Reason: wrong url

gustancho.com

Best Mortgage Calculator | PITI, PMI, MIP, and DTI

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[Peter]

Thanks, let me know what I need to do .

[Gustan]

Mortgage lenders typically ask for CPA (Certified Public Accountant) letters from self-employed borrowers for several reasons:

Verification of income: Self-employed individuals often have variable income streams, making it more challenging for lenders to assess their financial stability. A CPA letter can provide verification of income, including details such as average income, profitability of the business, and consistency of earnings over time.

Confirmation of business viability: Lenders want to ensure that the self-employed borrower’s business is stable and viable. A CPA letter may include information about the business’s financial health, such as its profitability, assets, liabilities, and overall financial stability.

Compliance with lending requirements: Mortgage lenders have strict underwriting guidelines and regulatory requirements that they must adhere to. Requesting a CPA letter helps lenders ensure that they are compliant with these requirements and have sufficient documentation to support the borrower’s financial situation.

Reduction of risk: Lenders use CPA letters as a risk mitigation strategy to reduce the likelihood of default. By obtaining verification of income and confirmation of the borrower’s business viability, lenders can make more informed lending decisions and mitigate the risk of lending to self-employed individuals with unstable financial situations.

Overall, requesting CPA letters from self-employed borrowers helps lenders accurately assess their financial situation, verify their income, and mitigate the risk associated with lending to individuals whose income may be less predictable than salaried employees.

[Gustan]

We are waiting for Donna to do some reasearch. I called her earlier today and she did not answer. Need to see what type of properties are in the market, property taxes,etc. I need to talk to Brent as well. By the way, what area in Louisiana were you open to buy a house? Just want to research homeowners insurance, property taxes, and property value just in case Florida is out of the buying market and priced out.