Financing For Creative Types

Self-employed? Have non-traditional income? No problem.

As a part of the loan approval process, borrowers have to provide documentation about the sources of funds in their bank accounts. For many borrowers, this is fairly simple: if you have a job with a salary, your payroll deposit shows up in your bank account every other week.

Welcome to Idea City

But in Austin, we have a large population of self-employed creative folks—people who work in music, film, and advertising production—who receive all kinds of non-traditional and non-salary income. Luckily, we’re used to these types of borrowers and usually ask them for a short explanation about their line of work and income to make it easier for the underwriter to understand.

Finding the Paper Trail

Recently, I received an email from a client who works as an accountant for many creative folks. In describing his income, he said:

“I also receive Zelle, Venmo and PayPal payments from clients. This scattershot approach is the result of dealing with musicians, many of whom have never seen a checkbook or money order in their lives.”

As someone who also has many creative clients, I understood his frustration in finding the right documentation. Part of my job as a loan officer is to help the underwriters understand my self-employed clients’ sources of income. In the past, I’ve had to explain income for everyone from acupuncturists, authors and freelance photographers to musicians who receive income from publishing and licensing. I’ve documented finances for members of a film union who are paid through multiple production companies. I’ve had to explain how folks sold production equipment and musical gear to fund down payments (yes, eBay can count as documentation, but that’s probably a subject for another post).

I’ve Worked with Butchers, Bakers, and Candle-Makers

If you have any questions about getting mortgage financing for self-employed people, give me a call. I always welcome the challenge of working with creatives, and love learning about their businesses while I teach them about the process of mortgage underwriting.