Jumbo Profit And Loss Jumbo Florida Mortgage Lenders
Qualifying Profit Loss Income
Qualifying income is the lower of the 12 12-month profit and loss statement (P&L) or monthly income disclosed on the initial signed Florida Jumbo mortgage application.
Self-employed Borrower(s) only. Self-employed Borrower(s) who file their tax returns are NOT eligible
✓ Minimum of two (2) years self-employment in the current profession
o Validation of a minimum of two (2) years existence of the business from one of the following: Business License, Letter from Tax Preparer, Secretary of State Filing or equivalent
✓ Self-Employed defined as Borrower owning >=50% ownership of respective business
✓ Ownership percentage must be documented via Certified Public Account (“CPA”)/IRS Enrolled Agent (“EA”)/California Tax Education Council (“CTEC”) letter, Operating Agreement or equivalent
✓ The CPA/EA/CTEC preparing the P&L must have filed the Borrower’s most recent business tax returns
Most recent 12-month Profit & Loss statement (P&L). The P&L end date must be less than sixty (60) days old at the closing.
✓ All Profit & Loss statements must be completed by an independent CPA/EA/CTEC
✓ The CPA/EA/CTEC prepared P&L must be signed by both the Borrower and CPA/EA/CTEC
✓ CPA/EA/CTEC must provide attestation that they prepared Borrower’s tax returns and that they are not related to the Borrower or associated with Borrower or Borrower’s business
✓ The CPA/EA/CTEC must attest that they have performed either the following functions:
o Audited the business financial statements
o Reviewed working papers provided by the Borrower
✓ Credit file must contain documentation that the CPA/ CTEC license is verified and active. A screen shot of the IRS web site for an IRS Enrolled Agent (EA) is acceptable
✓ Borrower narrative on the nature of the business required
✓ An internet search of the business is required with documentation to be included in the credit file to support existence of the business
✓ Employment verification documentation must be consistent with information on the loan application and Borrower’s credit report
✓ Verification of business existence and that the business is fully operational/active required within ten (10) calendar days of closing
