I am applying for a loan modification with my mortgage company and I run a child care from my home. So I need to know if showing more profit than loss would benefit my chances to get approved. They are also asking for my 2008 tax return and Bank statements. I just need to know so I will not get my hopes up.
I have a state license for my day care and file taxes every year.
Less income is better – if you can prove you have enough to make the current payments or the higher payments if you have an ARM, that is just where your payments will stay. If you show too little the lender may think you are going to lose the home anyway and not bother. There are some scam companies out there that charge a few thousand if they get your payments reduced – even if that reduction does not cover their fees. Hope your mortgage company is working directly with you.
Showing more profit than loss is always a positive. However, I would not have any “funny” numbers in there to do so. I’m assuming that you are “not” running a licensed daycare and you may run into some issues here (not 100% sure though). I’ve always felt that honesty is the best policy…in other words, do unto others as you would have them do unto you. Just as you would not want the bank (mortgage company) to lie or misinform you, you shouldn’t do this to them either.