The gig economy — with its freelancers, contractors and self-employed
workers — is upon us. It’s a career choice embraced by a growing number of people. While
these workers are making up a larger slice of the modern workplace, they often don’t
qualify to own a home.
It’s not because they can’t afford one or won’t be able to make loan payments. It’s because
tightening lending standards are often leaving them on the outside looking in. This is an
opportunity for mortgage originators.
Steven is your typical young professional trying to make a living in today’s world. In his
mind, he has figured out a great plan for life. During the day, he works as a freelance
copywriter, picking up assignments through various contacts he has met over the years.
At night, he uses his car to make extra money by driving for a rideshare company. And
as a frequent traveler, Steven often lists his apartment on a home-share website to earn
additional income when he is out of town. This is a dream for Steven. The work-schedule
flexibility and general lifestyle are everything he could want.
But Steven and his wife face a major problem. The home of their dreams is out of reach.
He cannot obtain a mortgage, despite having more than enough money for a downpayment
for a starter home as well as the cash-flow to make the required payments on the loan.
Steven is a textbook representative of the so-called gig economy — an independent
contractor who takes on a variety of short-term jobs as opposed to
being locked into a traditional 9-to- 5 work schedule.
By Tom Hutchens
Executive vice president, production
Angel Oak Mortgage Solutions
Illustration by Jeffery Sabourin
69 Scotsman Guide Residential Edition | ScotsmanGuide.com | November 2018
Tightening lending standards have
left many on the homebuying sidelines