Navigating the Mortgage Process When You're Self-Employed

Apr 18

By Kyle Guldenpfennig, aka #TallMoneyMan | Host of The Lofty Lender Podcast

Buying a home is one of the biggest financial decisions you'll make—and if you're self-employed, you may have heard it's "too hard" to qualify for a mortgage. In this week’s episode of The Lofty Lender podcast, I sat down with fellow lending expert Charlie Chedester to break down the myths and truths about self-employed homeownership. Spoiler alert: yes, it’s 100% doable—and we’re here to help make it happen.

Here’s what we covered and what you need to know if you’re self-employed and thinking about buying a home.

Who Counts as Self-Employed?

Being self-employed doesn't just mean owning a corporation or a full-fledged business. You might fall into this category if you:

Drive for Uber or Lyft
Run a side hustle like selling on Etsy or doing freelance work
Earn tips as a bartender or server
Receive 1099 income or get paid in cash

If you're not receiving a regular W-2 with taxes taken out, there's a good chance you're technically self-employed in the eyes of a lender.

The Myth: It’s Harder to Qualify

One of the most common myths we hear is that it's way harder to get a mortgage when you're self-employed. While it's true that the process can be different, it's not impossible—and it shouldn't feel overwhelming.

Many borrowers come to us after hearing bad advice from a previous lender or bank—like needing seven years on the job or amending tax returns unnecessarily. The truth is, the problem isn’t your income—it’s that many lenders don’t know how to read your tax returns. We do.

What You Really Need as a Self-Employed Buyer

To qualify for a mortgage, you'll need to be able to prove consistent income and financial stability. That typically includes:

Personal and business tax returns (often two years)
Profit & loss statements
K-1s or 1099s if applicable
A strong relationship with a CPA who can provide supporting documentation

We often work directly with your accountant to make sense of your returns—and to advocate for you when underwriters have questions. This is not the time to DIY your taxes on TurboTax. Get a professional involved, and let’s make your numbers shine.

Vanilla vs. Non-QM (aka Outside-the-Box) Loans

We always start by seeing if we can get you qualified under traditional (aka "vanilla") loan guidelines, like conventional or FHA loans. These tend to offer better rates and terms. But if your income is structured a little more uniquely, we also offer non-QM loans, which may allow us to:

Use bank statements instead of tax returns
Consider debt service coverage ratios for investment properties
Offer portfolio loans with more flexible underwriting

Yes, these loans can sometimes come with slightly higher costs, but they can also make the difference between renting and owning.

Why Advocacy Matters

Not all underwriters see things the same way, and sometimes we have to fight for your file. One of my favorite parts of the job is advocating on behalf of self-employed clients. When we know the file is solid, we’re ready to argue—and win. Because your story and financials deserve to be understood, not dismissed.

Tips to Succeed as a Self-Employed Buyer

Get Organized Early: Have your tax documents, business financials, and CPA contact info ready.
Consistency is Key: Avoid major swings in how you file your taxes or structure your business from year to year.
Talk to Experts: Not every loan officer understands self-employment income. Work with one who does (hey, that’s us 👋).
Have the Right Mindset: Yes, there may be a few extra steps—but with the right team, it’s a smooth journey.

Bottom Line

Being self-employed doesn't mean you can’t buy a home. It just means the path might look a little different—and that’s OK. With the right preparation, guidance, and advocacy, you can absolutely become a homeowner on your own terms.

🎙️ Listen to this full episode and more wherever you get your podcasts. Just search The Lofty Lender with #TallMoneyMan and hit subscribe.

Have questions about qualifying as a self-employed borrower? Reach out—we’d love to help guide you home.

Contact Us to Start Your Homeownership Journey → www.teamchedester.com/contact-us

Kyle Guldenpfennig