Mortgage Solutions for

Self-Employed Borrowers

Mortgages specifically designed for self-employed and freelance borrowers in California.

Are you self-employed or freelancing in California?

Getting a mortgage can feel challenging when your income doesn’t fit neatly into a W-2 box, but it doesn’t have to be. Traditional conventional loans aren’t the only path to homeownership. Lenders now offer flexible programs designed specifically for entrepreneurs, business owners, consultants, or creatives. Anyone who doesn't fit neatly in the W-2 income box.

Below, you’ll find some of the most popular options available to self-employed borrowers.

Self-employed borrowers usually earn income differently than traditional W-2 employees. Business deductions, multiple income sources, fluctuating earnings, and unique tax situations can sometimes make mortgage qualification more challenging.

The good news is that there may be several ways to qualify depending on your circumstances. Below are some of the most common financing options available to self-employed borrowers.

Which Situation Sounds Most Like You?

When a Bank Statement Loan Makes Sense

You've written off too many expenses to qualify for the loan you need, but you have income coming in.
You've been self-employed for at least 1 year.
You make all (most) of your business deposits to one bank account (either business or personal)
Your deposits aren't necessarily consistent, but they do show an overall pattern during the most current 12 months.
You can prove the deposits came from your business earnings.
Your FICO score is at least 620
You have at least 10% for a down payment or 10 % equity in your home.
Loan amount: $250,000 to $5,000,000

A popular loan for both purchases and refinances, either business or personal bank statements are acceptable, but only one account can be used.

If personal bank statements are used, 100% of income deposits are counted. If business statements, a percentage is deducted for expenses, the percentage amount will depend on the type of business.

Related Situations:

When to Use an Asset Depletion Loan

You have substantial assets in checking, savings, financial investment accounts and/or retirement accounts.
You do not have to disclose any work history.
Your assets can be in multiple accounts.
Your assets have been in your accounts for at least 2 months.
Loan Amount: to $5,000,000

Cash assets are counted 100% face value. Securities at 80% and retirement funds 70%.

On purchase loans, assets considered are after down payment.

Asset utilization can be combined with other loan types to increase income

Related Situations:

When to Show Your Income Using a Profit & Loss Statement

You have substantial income, but write off too many expenses on your tax return.
You have been self-employed for at least 2 years.
You have a down payment or equity of at least 20%
Your purchase or refinance must be for an owner-occupied property.

The adjusted gross (income minus expenses) is the income that will be considered.

Related Situations:

When You Are Receiving Retirement Income

Retirement income from all sources is utilized
You may increase the monthly distribution for the purposes of qualifying
Retirement income must be ongoing

Retirement income may be used as an addition to business income if you are working either self-employed or payroll

Related Situations:

DSCR Loans for Investors only

Debt Service Coverage Ratio
The Rental income must cover Principal, Interest, Taxes, Insurance, and HOA dues (if applicable)
Applies to single-family homes, condominiums, and PUDs, as well as 2-4 unit properties.
Your down payment or equity must be at least 15%
Loan amounts to $3,000,000
Property may be located anywhere in the U.S.
Your personal income is not considered or disclosed

A popular, in-demand loan for property investors.

Related Situations:

Buying Investment Property

When a Reverse Mortgage Might Be Your Choice

You must be 62 years of age; however, there is a special jumbo reverse mortgage for those 55+.
You may use a reverse mortgage for both purchases and refinances.
The amount of the loan is determined by your age and the amount of equity in the property.
You have no mortgage payments for the life of the loan as long as it remains your primary residence.
Your property stays in your name, not the lender's.
You can refinance or sell the home with no penalty.