Mortgages for self employed buyers
Self employed borrowers can get standard mortgages, but lenders usually qualify you on the income shown on your tax returns after business deductions, often for the past two years. Some lenders also offer non-QM bank statement loans that use deposits instead, usually at a higher cost.
Standard loans
- Expect to provide personal and business tax returns, often for two years, plus a year to date profit and loss statement.
- Lenders usually average income and may count it lower if it fell from one year to the next.
- Large write offs lower taxes and also lower the income a lender can count.
Bank statement loans
- A non-QM product some lenders offer, using 12 or 24 months of bank deposits to estimate income.
- Usually higher rates, larger down payments and more cash reserves than standard loans.
- They are not backed by Fannie Mae, Freddie Mac, FHA or VA, so terms vary widely by lender.
Questions people ask
- How long do I need to be self employed?
- Many lenders look for two years of history. Some accept less with prior work in the same field. Ask lenders before you apply.
- Can I use a business account for the down payment?
- Often yes, with documentation and sometimes a letter or cash flow review showing the business can afford it. Rules vary by program.
- Is a bank statement loan a bad idea?
- Not always, but it usually costs more. Compare it with a standard loan using your tax returns before you choose.
Official sources
- CFPB, Understand the different kinds of loans ↗
- Federal Register, General QM final rule (Dec. 29, 2020) ↗
- Consumer Financial Protection Bureau, Buying a house ↗
Facts checked 2026-11-01. General information, not financial, legal or tax advice. We are not a lender.