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Self-Employed Borrower & LPA One-Year Approval
Question:
My client has been self-employed for more than 5 years in the same line of business. 2 years ago, he incorporated his business into an LLC [same address, just a change in corporate status]. When submitting to LPA, I stated that he was self-employed for more than 5 years and received the 1-year approval. However, when the processor submitted it, they changed it to 3 years working as self-employed for one place and 2 years working as self-employed for another. This resulted in not receiving the 1-year approval. Is this how it should have been submitted to LPA?
Answer:
Bad news here…… Your underwriter/processor made the correct change. Freddie states it must be the same company and the same filing method to qualify to be treated as 5 years self-employed.