Self-Employed Mortgage Financing

Being self-employed does not mean being unqualified. It means the income needs to be documented in a way that reflects how the business and borrower actually operate.

Why tax returns can create a problem

Business owners often use legitimate deductions that reduce taxable income. Standard mortgage analysis may therefore show less qualifying income than the borrower actually experiences in cash flow.

Alternative documentation can help

Depending on the program, bank statements, 1099 income, assets or other approved methods may be used instead of—or alongside—traditional tax-return calculations.

The first step is diagnosis

Before choosing a program, I review how the income is earned, how long the business has operated, available assets, credit, property type and down payment.

Frequently Asked Questions

Do self-employed borrowers always need two years of tax returns?

No. Some conventional and alternative programs may allow different documentation depending on the borrower’s history and circumstances.

Can bank statements be used instead of tax returns?

Certain Non-QM programs allow qualifying income to be derived from eligible personal or business bank statements.