Hi again!
I am hoping someone here can answer as to whether or not I am correct.
In looking through the company tax return for Dad's S-Corp, he is at 24% ownership.
Is it--25% stock-holder in the company or more constitutes self-employed, or is it that 25% or more personal income from S-Corp constitutes him being self-employed?
Pertinent facts:
He is a salaried employee and draws from the company quarterly.
P&L showed lower numbers but the gross profit percentages are the same for the last three years.
Background for those not seeing my earlier post: We were asked for a LOX and P&L because 2006 was such a good year for the company and the numbers were very high, which made 2007 look like it was in decline. LOX looked good, P&L was lower, but accountant wrote a note saying that the business is not in decline and pointed out that the gross profits percentages are the same. What worries me is that he said that BOTH 2006 and 2007 were banner years, though according to my dad, that was only true for 2006, which he explained in his LOX.
I don't think my LO is all that knowledgeable, because he has a hard time answering my questions, which is why I am asking so much here. We are working directly with the lender, not a broker, so I think some of this is new to him. (Their FHA approved underwriter (checked on HUD) has been working for the bank since 1986, and we are locked at 5.5, so I can't just work with a new lender at this point).
If my loan, which has been DU approved, gets denied at this point, it would only be if my DTI changes due to the P&L. Does anyone see any valid points that I can make to get this through in case that happens?
