I am a Self-Employed Borrower. What additional documents do I need to buy or refinance a home?

  • Individuals who are self-employed often have greater challenges in terms of getting a loan compared to a W2 wage earner.
  • For lenders, verifying a self-employed person’s income is more difficult as these borrower’s typically lack pay stubs,W2’s etc…therefore, verifying employment is handled differently.
  • In the absence of verifiable employment records, lenders most often rely upon the 2 most recent years of filed income tax returns for the business and / or personal 1040’s.
 Required Self Employed Borrower Documents for government and conventional loans: 
  • Personal Tax returns also known as 1040’s for the last two years, PLUS a year-to-date Profit and Loss statement for the current year through the most recent calendar quarter.  If you have filed an extension, you will be required to supply a copy of the extension.
  • K-1’s for all partnerships C Corp and S-Corporations for the last two years . This shows the amount of income that passes through to you and your percentage of ownership in the company; in addition, whether the revenues and net income of the company has declined.
  • Completed and signed Federal Partnership (1065) and/or Corporate Income Tax Returns (1120) including all schedules, statements for the most recent two years. (Required only if your ownership interest is 25% or greater.)
  • Business licenses may also be required to show proof that the business exists.
* Additional documents may be required depending on the type of loan and underwriting requirements
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