1099

A home loan solution for self-employed borrowers.

 

A 1099 income loan is a mortgage solution for self-employed and contract workers who have trouble qualifying for a conventional loan. Borrowers can use their 1099 earning statements to show work income instead of tax documents.

Program Features

Loan Amounts up to $3 Million

Up to 90% LTV on purchases

Up to 80% LTV on cash-out refinances

No limit on cash out up to 70% LTV, $500k above

Up to 50% DTI

Minimum 620 FICO

Primary Residence, Second Home, and Investment Property Eligible

Primary earner FICO score utilized

Frequently Asked Questions

Yes. Instead of tax returns, A&D uses the actual wages from their 1099 form as qualifying income for their new home loan.

Documentation for the 1099 mortgage is quite minimal, but includes


• 1099s for the last 2 years from the same employer – Stability is the key to getting mortgage approval.


• Paystub showing their YTD income -OR- Acknowledgement from their employer that their 1099 income matches what they report help us to know they can afford the loan. If they do not have a YTD paystub, a written Verification of Employment works too.


• Proof that they do not have mandatory expenses – Mandatory job expenses differ from the optional expenses they write off.


• Letter from their CPA regarding their expenses –Most 1099 contractors have expenses – it comes with the territory.

All borrowers regardless of their credit score, need 3 months of reserves on hand. Reserves are money they have available (liquid assets) after they pay their down payment and closing costs. It is like an emergency account, letting us know they can cover at least 3 months of mortgage payments if something happens.


To qualify, they will need 3 months of principal, interest, real estate taxes, homeowner’s insurance, and HOA dues in a liquid account such as checking savings, CDs, or liquid investments.

If your borrowers are contractors, salespeople, or consultants, they deserve mortgage financing just as much as someone with a salaried (W-2) position. If they can prove they can afford the loan and their income is steady, they deserve the same loan treatment.


The 1099 Income Program makes it a lot easier to secure a mortgage despite working as a 1099 employee. With no prepayment penalties on owner-occupied homes or second homes and the allowance of up to 6% of the purchase price for closing costs from interested parties, we make it easy to secure financing to buy a home as a 1099 employee.

Pre-Approval Wizard