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Business License

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Established Contributor

Business License

If self employed do underwriters require a business license? I've lived in this state for 5 years and when we moved here I got my sales tax certificate but when I called the local clerks office they said I did not need a license for a home based business. Now doing more research online (after coming across a business license discussion) our state website says I need a business license and to contact my local clerks office. I'm wondering if whoever I spoke with several years ago was incorrect on the requirements.  All of this to say, is this going to be something the underwriter asks for? If so, will they accept my sales tax certificate or something else? I'm assuming the license would be used to confirm that I had been self employed for at least 2 years which is easily determinable by looking at my tax returns.

Starting Score: 6/17/15 EQ: 589 EX: 593 TU: 579
Current Score: 5/22/16 EQ: 703 EX: 697 TU: 713
Goal: 700s by June 2016
Message 1 of 7
6 REPLIES 6
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Super Contributor

Re: Business License

i have never seen one required.... unless it was a new business and it was a funky file.

 

if you have a 2yr history of paying taxes s/e i am fine with that

 

Retired Lender
Message 2 of 7
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Super Contributor

Re: Business License

think about it.....

 

i get people with ebay side businesses a lot. and we use their income.

 

no need for a license to sell sock monkeys

 

Retired Lender
Message 3 of 7
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Community Leader
Super Contributor

Re: Business License

Underwriters will occasionally require 3rd party evidence of self-employment.  Some examples of how it can be documented are:

  • Business license
  • CPA/tax preparer letter
  • Website or other marketing material
  • Letters from vendors on their letterhead
  • Business insurance/bonds
  • A filed d/b/a
  • Membership in professional industry organizations/groups
  • A sales tax certificate

It's asked for to confirm you are still operating the business (since tax returns only show that you have operated the business in the past, but isn't evidence that the business is still going on right now).  You'd think it'd be common sense, but mortgage guidelines aren't always that way.

Helping people with mortgages (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Orange County, CA and lending in all 50 states
Message 4 of 7
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Established Contributor

Re: Business License

Are the items on that list interchangeable? For example, if they asked for the license could you provide a sales tax certificate instead?  

Starting Score: 6/17/15 EQ: 589 EX: 593 TU: 579
Current Score: 5/22/16 EQ: 703 EX: 697 TU: 713
Goal: 700s by June 2016
Message 5 of 7
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Community Leader
Super Contributor

Re: Business License

They don't normally ask for a specific document, the underwriter would just ask for "evidence of self-employment" and so any of those items could satisfy it.

Helping people with mortgages (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Orange County, CA and lending in all 50 states
Message 6 of 7
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Super Contributor

Re: Business License

pretty lenient condition.

 

i have put screen prints of websites in the file

 

Retired Lender
Message 7 of 7
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