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Applying for a mortgage as 1099 employee

In addition to my checks (which have my base and commission) I regularly receive cash bonuses at work. Everywhere I've looked to apply online for a mortgage askes for my W2, which I obivously don't have. What are my loan options as I am an independent contractor? by cando_coverage784... from Salem, Massachusetts. Sep 3rd 2014 Reply


Joe Metzler (JoeMetzler)
#1 ranked lender in Minnesota - 3,522 contributions

You need to follow the self-employed rule. Therefore the lender is going to require you to be self-employed for two-years. You will need to provide your 1099's, and the last two-years Federal tax returns. The lender will see what you reported for income, subtract out any work related expenses you claimed, and whatever is left, averaged over the two-year period is what will become your qualifying income... Easy... Read more at http://joemetzler.com/self_employed_homebuyers.htm

Sep 4th 2014
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Marty Stern (rubicon1020)
#407 ranked lender in California - 74 contributions

As a self employed worker, you'll need a work history of at least two full years, and you'll have to provide tax returns for 2013 and 2012 plus a year to date profit and loss report. Typically, the lender will do a one or two year average of your income for those years, going from the net income number you report to the IRS after all your deductions (though we can add back in the depreciation.) Your 2014 income will not be used, however if you are making a lot less in 2014 than in 2013 and a lot less in 2013 than 2012, that could be a problem. So, I'd recommend you talk to a good local mortgage agent, bring your taxes for them to look at (among other income/asset statements), and you should be able to get an idea on what you're qualified for.

Sep 3rd 2014
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Your income will be averaged over the past two years using your tax returns. I would suggest getting qualified by speaking or meeting with someone local. (Like me)

Sep 3rd 2014
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