You can get a mortgage loan if you are self employed. The ideal length of self-employment is two years. However, there are loan programs that you can qualify for if you have been running your own business for less than two years.

For a self-employed borrower to prove income in a full documentation loan program, the underwriter will use the amount shown as net income on the Schedule C of the borrowers tax return. There are also some loan programs, primarily from sub prime lenders that allow the borrower to submit banks statements. Typically the borrower will submit anywhere from 6 to 24 months of statements, current and consecutive, and the lender will use the deposits in the bank as proof of income.

Self-Employed home buyers can also use Stated Income loans. Stated Income mortgage is a type of loan program in which the applicant discloses the income, but no supporting document is needed. In other words, W2's tax returns, and pay stubs are not required with the loan application.

Many lenders offer self employed borrowers the option for stated income loans with the same rates as a conventional program. Be sure to ask about Fast and Easy loan programs and whether you qualify for them.

To prove the self employment status, the lender will accept the business license that's two years or older or an employment verification letter from a legitimate CPA

This is required whether or not you apply for a full documentation loan or a stated income loan.

 

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