1099 Only loans: your 1099 is the income doc.
If your income arrives on Form 1099 — contractor, real-estate agent, financial advisor, gig worker — you don't need to wade through tax returns to qualify. Your most-recent 1099 plus 60 days of statements does the job.
Quick answer: what is a 1099 Only loan?
- Income source: most-recent 1099(s) + 60 days of bank statements as a sanity check.
- Tax returns required? No.
- Who it's for: independent contractors, commissioned salespeople, gig workers, real-estate agents — anyone whose income arrives on Form 1099.
- Min FICO: typically 660+.
- Down payment: typically 15–25%.
- History: usually 2 years of 1099 income.
How underwriting calculates 1099 income
The underwriter takes the gross 1099 amount and applies an expense haircut to get qualifying income — same logic as business bank statements, since 1099 revenue typically has expenses behind it.
- Default expense factor: typically 50% (1099 gross × 50% = qualifying income).
- Lower expense factor can be used with a CPA letter documenting actual overhead — common for low-overhead 1099 work like real-estate agents, financial advisors, and pure-service contractors.
- The 60 days of bank statements should show deposits roughly consistent with the 1099 revenue.
Worked example
Real-estate agent, prior-year 1099 = $240,000. Business overhead minimal (license, MLS, marketing) — CPA attests true expense ratio is 20%.
- Default 50% factor → $120,000/yr → $10,000/mo qualifying income.
- 20% factor with CPA letter → $192,000/yr → $16,000/mo qualifying income.
1099 Only vs. Bank Statement — when to pick which
If your income is primarily 1099 from a small number of payers, 1099 Only is usually cleaner — one document instead of 24 statements. If you receive a mix of 1099 and direct-payment work, bank statements may capture more of the picture.
What you'll need
- Most-recent 1099(s) — most programs accept the prior tax year's 1099s.
- 60 days of business or personal bank statements showing recent deposits.
- Optional CPA letter for a lower expense factor.
- 2 years of self-employment / 1099 history.
- Standard mortgage docs.
FAQ
I just switched from W-2 to 1099 last year. Will 1099 Only work?
If you have less than 2 years of 1099 history, you're likely better off with 12-month bank statements or, if you have liquid assets, an asset-based program.
My 1099s are inconsistent year to year. Does that matter?
Investors typically use the most-recent year. If the most-recent year is meaningfully lower than the year before, underwriting may average — we'll model both.
Do I need to itemize my expenses?
Not for the loan. The expense factor is applied programmatically — a CPA letter can lower it, but you don't need to schedule expenses out.
Can I use 1099 income from multiple payers?
Yes. Underwriter sums the 1099 totals across all payers.
My 1099 has YTD gross only — no prior year. What now?
If you have less than 12 months of 1099 income, talk to us about bank statement programs or asset-based qualification instead.
Ready to see if this is the right program?
Start the application or book a 20-minute call. We'll model real numbers, not estimates.