Specialty Lending
Self-Employed Borrowers
Being your own boss should not make buying a home harder. We work with self employed borrowers every day and know how to get deals done that other lenders turn away.
Smart Financing. Personal Service.
How It Works
What You Need to Know About Self-Employed Borrower Loans
The mortgage process looks a little different when you work for yourself. Here is what to expect and how we help you navigate it.
1
Income Is Calculated Differently
Lenders use your net taxable income, not your gross revenue. If you take significant deductions, your qualifying income may be lower than you expect. We help you understand the numbers upfront.
2
Two Years of History Matters
Most programs want to see at least two years of self employment income. We review your tax returns and identify which loan program gives you the strongest qualification.
3
Bank Statement Loans Are an Option
If your tax returns do not tell the full story, a bank statement loan may allow you to qualify based on your actual deposits rather than your taxable income.
4
Your Business Structure Matters
Whether you are a sole proprietor, LLC, S Corp, or partnership affects how your income is documented. We know how to read each structure and present your file correctly.
5
A Strong Application Takes Preparation
Self employed files require more documentation upfront. We walk you through exactly what you need before you apply so there are no surprises mid process.
Basic Eligibility Requirements
Self Employment: Two or more years of documented self employment history
Income: Verified through tax returns, bank statements, or P&L depending on loan type
Credit Score: Typically 620 or higher, higher for bank statement programs
Down Payment: Varies by loan type, typically 5% to 20%
Debt to Income: Generally 43% to 50% depending on loan program
Business Viability: Active business with consistent or growing income
Reserves: Several months of payments in verified assets often required
Location: Texas, Florida, Minnesota, or Colorado
Pros and Cons
Is a Self-Employed Borrower Loan Right for You?
Self employed borrowers have real options. Here is what to weigh before moving forward.
The Advantages
- Access to the same loan programs available to W2 borrowers including FHA, VA, and conventional.
- Bank statement loans provide an alternative path when tax returns show low taxable income.
- An experienced lender can structure your file to make the most of your documented income.
- Business ownership can work in your favor with the right loan type and documentation approach.
- No requirement to change how you run your business or your tax strategy to qualify.
The Tradeoffs
- Tax deductions that reduce your tax bill also reduce your qualifying income.
- More documentation required upfront compared to a standard W2 application.
- Bank statement loans typically carry higher rates than conventional financing.
- Two year self employment history is required for most programs with limited exceptions.
- Income that is inconsistent or declining year over year can complicate qualification.
Who It's Best For
Self-Employed Borrower Loans Work Best For...
These loan options are specifically designed for borrowers whose income does not fit neatly into a W-2 box.
Business Owners
Self employed borrowers who own their own business and write off significant expenses on their tax returns.
1099 Contractors
Freelancers and independent contractors with strong income who do not receive a traditional W-2 from an employer.
Previously Turned Down Borrowers
Borrowers who have been denied elsewhere because of how they file their taxes and need an advisor who understands their situation.
Common Questions
Frequently Asked Questions
Straight answers to the questions we hear most often.
How do self employed borrowers qualify for a home loan?
Most self employed borrowers qualify by showing stable income over time, usually with tax returns, profit and loss statements, or bank statements, along with meeting minimum credit score and debt to income guidelines.
What documents do I need if I am self employed?
Lenders often ask for one to two years of personal and business tax returns, recent bank statements, profit and loss statements, and documentation for any 1099 income, plus standard items like identification and asset statements.
Can I use bank statements instead of tax returns?
Some self employed and non agency programs let you qualify using twelve to twenty four months of personal or business bank statements or 1099s to document cash flow, which can help if tax write offs reduce your taxable income.
Do self employed borrowers need a higher down payment?
Down payment requirements are often similar to traditional borrowers, although some self employed programs may ask for a slightly larger down payment or stronger credit to offset variable income.
How long do I need to be self employed to get approved?
Many lenders look for at least two years of self employment in the same line of work, although some may consider one year if you have a strong history in that field and can document stable income.
Keep exploring
Compare self-employed options with your other options
DSCR Loans
Investment property qualified on the rental income instead of yours. Typically 20% to 25% down.
Jumbo Mortgages
For loan amounts above conforming limits. Typically a 700 score, 10% to 20% down, and verified reserves.
Conventional Loans
From 3% down at a 620 score. No upfront mortgage insurance, and PMI comes off at 20% equity.
Not Sure Where to Start?
Let's Figure It Out Together.
Whether you're ready to apply or just exploring your options, we're here to help. No pressure, no obligation, just honest guidance.