Lending Solutions for Members Seeking a Mortgage
People who work in film and television have traditionally faced great difficulty in qualifying for mortgages because traditional lenders do not understand the unique income structure of the entertainment industry. This article explains some misconceptions by our members, contributing factors as to why most traditional lenders are reluctant to issue loans to film/television technicians, and provides a list of lenders who do understand the unique income sources of the Local’s membership.
Successful Professional vs Unstable Job Hopper
In any given year a successful film technician may work for half a dozen (or more) different productions, enjoying a very comfortable level of income. However, when a traditional lending institution is presented with a stack of W2s and 1099s by that same individual the lender does not see “success”, they see instability.
More than a few members of Local 479 have encountered refusals from lenders for this very reason. In most other lines of work a variety of income sources is considered to be a sign of “job hopping”. This is a big red flag to a lenders because job hoppers can be risky investments.
There are a few more things you should know.
Who is Your Employer?
When a lender asks for a “Verification of Employment letter” who will you tell them to contact? If you answered “Local 479” you would be incorrect.
Local 479 is your union, it is not your employer. For that matter, neither is the production company, nor the studio behind the project.
So who is your employer?
Your “Employer of Record” is your payroll company.
This information is provided on the reverse side of your pay stub (take a look!).
If you work on multiple projects throughout the year it is likely you will be paid by multiple payroll companies, each of which will issue you a W2 during the ensuing tax season.
The Local is NOT Your Employer
It may seem silly but it’s such an important point that it’s worth repeating several times in this article that the Local is not your employer and yet Secretary / Treasurer Frank Hatcher estimates that he receives at least three or four requests for Verification of Employment letters from mortgage companies every week!
As Frank explains, since the Local is not your employer he is unable to legally verify to a lender a member’s history of employment, their start date, or whether they are currently employed. These are all things that an employer are allowed to do legally.
This fundamental misunderstanding by members can delay the loan process by a month, so please don’t make this mistake!
Documentation for Obtaining a Loan
When you go to make an application for a loan you will need to take a variety of documents to help establish your financial standing and to allow the lender to gauge your ability to repay the loan. Among those are paycheck stubs (ie, “paystubs”) demonstrating your work history. You will certainly need to take your most recent paystubs with you and, depending on the lender you may have to submit upwards of 2 years worth of pay stubs (this is not uncommon).
Film Friendly Lenders
Local 479 maintains a list of mortgage companies who have demonstrated an understanding of the film/television industry and an ability to underwrite mortgages for our members. These groups should be also able to accept a work dues assessment statement as part of their documentation, helping to speed the process along. Members can log into the Member Dashboard to view a list of film friendly lenders (click here).
Suggested Tools Available to Members
The local gladly provides members seeking a loan with a letter of good standing in the Local along with an up-to-date work dues assessment statement.
These two documents may reduce the amount of time required for your lender to process your loan, and are likely to be requested at some point by the lender so it’s a good idea to get a copy as you begin seeking a loan.