Loan modification is starting to be a very common way for individuals to stay in their homes by negotiating the conditions of the loan with you bank. Nevertheless, prior to getting the approval, you must show that you can repay the modified loan with your current earnings.

If you are self-employed, it may be hard to prove your earnings when presenting it to the bank. This could be so for many different circumstances. Nevertheless, banks must have a type of proof that you will be able to pay back the mortgage.

To solve this problem, you could request your accountant for a financial statement. The financial statement needs to be for the last six months. It is fundamental that the financial statement is completed by your accountant since it will have credibility to the statement.

After you get the final amount from your accountant, you consider the number as a normal paycheck. You should plug in that number to calculate the debt-to-income ratio which is the critical factor to determine if the loan modification will be obtained.

By using this amount, you discount the importance of business expenses, rentals, etc. Just the basic number showing your present earnings is seen in this statement.

Once you have done this, submit this value to the bank. The value won’t be audited or reviewed. The bank may use it as documentation as long as it is given by a certified accountant

This is generally all the proof lenders require. Banks will use this document as demonstration of income when the individual has a business. Because lenders are willing to use this statement as proof of income, they must ensure that this letter comes from a certified accountant.

Remember that lenders expect to get some type of proof of earnings prior to approving the loan modification. By giving the bank with the financial document prepared by your certified accountant, banks will obtain the proof they require to approve the new loan.