Is it hard for traders to get loans/credit?

[chipmunk]

right now you have little chance......

 

[chipmunk]

That's true...as soon as you mention "work form home..." they auto think you are unemployed, skivvy, liar, criminal..Try it.

Definitley a snobbish attitude out there is the "corporate world"

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well now, getting a job is harder than getting a loan. Try telling them when they ask about your work history, "I just sit in my pajamas and stare at my computer" oh yeah, and I file as "Unemployed" (it raises fewer red flags)

 

[marketsurfer]

Quote from chipmunk:

right now you have little chance......

I would change that to ZERO chance without substantial collateral.

 

[riskaddict]

This is the one instance when having a wife with a job comes in handy. I'm also guessing it helps to use the same bank for everything. I just surprised my wife with a cx5 and I thought for sure I wouldn't be able to get the .9% financing since I just put homemaker down for employment. But they did it through chase which is who i do 90% of my banking and I was approved. I couldn't believe they were going to do this without even putting any money down if I didn't want to. But I know nothing about underwriting I'm sure they can find out anything they want without you putting it on the application.

 

[tradewiz50]

Quote from Zr1Trader:
They give some guy with 80k in college and cc debt making 40k a year a mortgage but not a guy who can pay cash for the house!

If you can pay cash for the house you don't need a mortgage in the first place.

 

[marketsurfer]

Quote from riskaddict:

This is the one instance when having a wife with a job comes in handy. I'm also guessing it helps to use the same bank for everything. I just surprised my wife with a cx5 and I thought for sure I wouldn't be able to get the .9% financing since I just put homemaker down for employment. But they did it through chase which is who i do 90% of my banking and I was approved. I couldn't believe they were going to do this without even putting any money down if I didn't want to. But I know nothing about underwriting I'm sure they can find out anything they want without you putting it on the application.

no doubt. smart. surf

 

[nicoleadam]

If you're an independent trader (either at home or prop) is this a big problem? Since your income is unpredictable it's possible that many lenders (or landlords even) would not want to deal with you.

If you have a high enough net worth, or make far enough into 6 figures a year, or into 7 figures, then obviously you shouldn't have many problems.

But for many aspiring traders who seem to simply want to replace the income from a job this seems like a risky proposition. My thought has always been if I can't expect to make 2-3 times what I could make in a job then this isn't worth pursuing.

If you're making 50k a year in a job and transition to making 50k a year as an independent trader, that could mean some big changes in your life. Not only a loss of benefits at work, but getting car loans, a mortagage, or even being able to rent an apartment could become big obstacles.

Anyone have any personal stories of how being a trader impacted this aspect of their lives?

I think it depends on the net result of your business, suppose if you drop a job and start a business and it gets successful then it will definitely give you more money than job. While if business is not going successful then job is better than it. I personally favor business because it gives you instant reward of your efforts.

 

[CSEtrader]

I talked this week to my neighbor... a senior executive of a company with $25 Billion/yr in sales... based upon what he said about "getting credit in this environment"... you've got less than the proverbial "snowball's chance in Hell".

Sorry.

Hello, SC,
How nice to find your post 16 years later and to know you are still on ET!
Does it change now in USA?
I recently received an offer from UK in my mailbox, where it is offered mortgages for traders with three years track record.
While we will certainly stay away from any loan, considering outcome of our adventure with UBS Bahamas, it would be nice to hear from you and others how the world changed.

 

[Scataphagos]

Hello, SC,
How nice to find your post 16 years later and to know you are still on ET!
Does it change now in USA?
I recently received an offer from UK in my mailbox, where it is offered mortgages for traders with three years track record.
While we will certainly stay away from any loan, considering outcome of our adventure with UBS Bahamas, it would be nice to hear from you and others how the world changed.

Seems the mortgage world is back into, "Approve anyone who can fog a mirror. We'll make the fees up front and hang defaults on the tax payer."

 

[murray t turtle]

I have found out the following when applying for (big) loans while being a trader:

Deposit every week or month the same amount in one of your bank accounts for a year or two, three.

When you apply for a loan, you are selfemployed, and if they ask you what you do, you say that you sell and buy securities. When they ask how much you make, you tell them the amount you have put in your bank account for the last two, three years or give them your tax return.

The loan officers, banks and leasing company's will treat you like any other business person.

If you just tell them you are a fulltime trader, they will not take you seriously.

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And also be ready to sign an IRS form releasing your taxes to bank , not just your copy. Even though a community bank may accept your 3 years tax forms......