Atlanta couple’s self-employment hurts loan chances

Marsha Middleton and her husband, Willie, have good credit, money in the bank and successful careers.

But the couple has struggled to find a mortgage to finance the dream home they are building in Brookhaven. Their quest already has lasted a year. They’re on their fifth mortgage broker.

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Marsha and Willie Middleton.

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The Middletons’ problem? They need a jumbo loan.

Jumbos — mortgages over $417,000 — have become increasingly difficult to get as the nation’s financial crisis has deepened. Mortgage brokers say most banks and other lenders simply won’t finance jumbo loans because they can’t find investors willing to buy them on the secondary mortgage market.

“You can’t blame them [banks] because of the way the industry is going,” said Marsha Middleton, 35, a public relations executive.

Not long ago, families like the Middletons had little trouble getting jumbo loans. “If we did this loan two years ago, it’s a slam-dunk,” said the Middletons’ mortgage broker, Mike Diffee.

The Middletons recently completed construction of the home, a sprawling 6,100-square-foot manse complete with nanny suite. The couple took out construction loans at a high interest rate in the low double digits, Diffee said, which they’d like to transition to a more affordable mortgage.

Diffee didn’t want to talk specifics, but he said the Middletons are seeking to borrow less than 60 percent of the home’s appraised value of $1.2 million.

Diffee, owner of Premier Mortgage Exchange, said he shopped the Middletons’ mortgage across the country and found only two firms willing to consider it. A California company looked at it but passed. It’s now being evaluated by an Atlanta lender.

The Middletons’ situation is complicated in that both are self-employed: She runs her own firm, M-Squared Public Relations, and he is a home builder. Because they’re self-employed, lenders consider them more risky.

Lenders “just view our income as it could be here [today] and gone tomorrow,” Marsha Middleton said.