As a 1099 income earner, you may have several loan options available to you. Here are some common loans that could be suitable for individuals with 1099 income and that we, here at Heritage Mortgage, specialize in:
Conventional Loans
Conventional loans are not backed by a government agency and are offered by private lenders. While they typically require traditional income documentation, some lenders may offer flexibility for self-employed individuals. You may need to provide tax returns, profit and loss statements, and other financial documents to verify your income.
Bank Statement Loans
Bank statement loans are designed for self-employed borrowers who have difficulty providing traditional income documentation. These loans rely on your bank statements to assess your income and ability to repay the loan. Lenders review your bank statements to evaluate your average monthly deposits over a specific period, typically 12 to 24 months.
FHA Loans
FHA loans are backed by the Federal Housing Administration and are accessible to a range of borrowers, including self-employed individuals. While FHA loans typically require tax returns and W-2 forms, some lenders may consider alternative income documentation. It’s important to discuss your specific situation with lenders experienced in FHA loans to determine their requirements.
Non-Qualified Mortgage (Non-QM) Loans
Non-QM loans are designed for borrowers who don’t meet the stringent requirements of traditional qualified mortgages. These loans cater to self-employed individuals and those with unique financial situations. Non-QM loans offer flexibility in terms of income verification, debt-to-income ratios, and other qualifying factors.
Private Lenders and Portfolio Loans:
Private lenders and portfolio loans are alternative financing options that may consider your 1099 income. These lenders often have more flexibility in underwriting criteria and may consider your overall financial profile rather than relying solely on traditional income documentation.
It’s important to note that the availability of these loan options may vary among lenders, and each lender may have specific criteria and requirements. As a 1099 income earner, it’s advisable to work with loan specialists who are experts in serving self-employed individuals. We can assess your unique situation, discuss loan options, and guide you through the application process. Consulting with a mortgage professional at HMBC can provide valuable insights and help you find the loan that best suits your needs.
