If you are self-employed, it can be a little harder for you to get a mortgage than someone who is an employee of a company that receives a regular paycheck and a W-2 statement at the end of the year.
If you are self-employed, most lenders will require that you’ve been self-employed for at least two years. Most lenders will also require that you provide the following information:
- Your personal tax returns for the past two years – including Form 1040, Schedule C (Profit or Loss from your business) and Form 1040, Schedule E (showing any Supplemental Income or Loss).
- If you operate as an S Corporation you’ll need to provide the income tax return for the S Corp – Form 1120S.
- If you’re part of a limited liability company, you’ll need to provide Form K-1 showing your share of profit or loss.
- Your lender may also require additional documentation.
To make yourself most attractive to lenders, it is also helpful to have available cash in a savings account to demonstrate your ability to make mortgage payments even if your income fluctuates.
