Income? I don't have to show you any stinkin' income!!

It’s a classic. Anyone who has ever seen the film The Treasure of the Sierra Madre with Humphrey Bogart remembers the original movie lines. In one of the scenes in the movie a Mexican bandit leader tries to convince Fred C. Dobbs (played by Bogart) that his gang are the Federales.

Dobbs: "If you're the police, where are your badges?"

Bandit: "Badges? We ain't got no badges. We don't need no badges! I don't have to show you any stinkin' badges!!"

Even as a loyal customer Mr. Bandit, when you approach Dobbs, your banker, for a real estate loan, he is going to ask to see your badge; your income that is.

But as a typical business owner; you may not report all of your income. You may even deduct higher than customary business expenses in order to lower your tax burden. And now you want to purchase a commercial building to house your company’s growth, as well as profit from appreciation, or you may need to refinance your existing business property for expansion but you can’t demonstrate enough income.

Thinking you’ll need a mask and gun to get the funding? Not at all. You don't have to show any stinkin' income!! You’ll only need to state your income on the loan application to any of the many commercial lenders that gladly finance commercial property for business owners that occupy the property themselves.  Unlike banks, whose charters require extensive income and expense documentation in addition to other lending restrictions, commercial lenders have much broader lending guidelines. 

To qualify you should have a good credit history and have at least 2 years in the business. But if you’re worrying whether the terms will be overly burdensome without documented income, consider this. With 30 year amortizations, 5 to 10 years longer than banks allow, and with comparable to slightly higher rates, payments for stated income loans should be about what your bank would have offered for a fully documented loan.

Many commercial lenders fund higher maximum LTVs (loan to values) for stated income loans than do banks, as high as 90%. Higher loan amounts are an added benefit as most banks’ charters restrict lending higher than 75% LTVs for purchases and lower still for cash out refinance loans. Eligible properties include, offices, warehouses, office condos retail, and mixed use property as well as specific use properties like auto repair, dry cleaners and others.