Brevard County · Buying
Buying while self-employed in Brevard County
The papers lenders ask self-employed buyers for, so nothing surprises you.
Free · Agents who know Brevard County · Every step in one app
If you work for yourself, buying a home can feel unfair at first. You may earn good money, but you do not have a simple pay stub, and you may have heard stories about self-employed buyers getting turned down or asked for paper after paper. It is normal to feel nervous, or even a little insulted, when a lender wants to see so much.
The truth is that lenders say yes to self-employed buyers every day. They are not doubting you. They just need to see your income the way the rules ask them to see it, which is mostly through your tax returns. Once you know what they look for, there are very few surprises.
The best thing you can do is start early. Gather your papers, talk to a lender before you tour, and you will shop knowing your real number.
What’s different for you
- Gather two years of papers. Lenders often ask self-employed buyers for tax returns and business records.
- Get pre-approved early. Self-employed files take longer, so start first.
- Then tour. Shop knowing your number.
When you start in CloseHive from this page, your plan already includes these steps, along with the usual ones for buying in Brevard County. You always see what to do next, and your agent handles the how.
What to know
Who counts as self-employed
Under the most common mortgage rules (Fannie Mae’s Selling Guide), anyone who owns 25% or more of a business is treated as self-employed. That can include sole owners, partners and people who own part of a company. If you are not sure which group you fall in, ask your lender at the start.
Lenders usually want two years
Fannie Mae’s guide generally asks for a two-year history of self-employment income. If you have been on your own for less time, you may still qualify when your most recent returns show a full 12 months from the business and you earned the same or more in the same kind of work before.
Your tax returns are the main proof
The standard is two years of signed personal tax returns with all schedules, and often your business returns too. In some cases one year is allowed, such as when the business has existed for five years. Lenders look at your taxable income, not just what the business brought in.
Write-offs lower the income a lender sees
Business deductions lower your taxes, but they can also lower the income a lender can count. Ask your lender which deductions, if any, they add back when they figure your income. This is a good question to bring to both your lender and your tax preparer before you apply.
Lenders look at the trend
The lender compares your income from year to year. Steady or rising income is easier to approve. If your income dropped, expect questions, and be ready to explain why in a short letter.
The lender will check with the IRS
Most lenders ask you to sign IRS Form 4506-C. It lets the lender get your tax transcripts through the IRS Income Verification Express Service. You approve or reject the request in your IRS online account. The numbers on your returns need to match what the IRS has.
Business money used for the purchase
If you plan to use money from your business account for the down payment or closing, the lender may ask for several months of business bank statements or a current balance sheet. They want to see that taking the money out will not hurt the business.
Your options
What to gather
- Last two years of signed personal tax returns, with every schedule
- Last two years of business tax returns, if you file them
- A year-to-date profit and loss statement for this year
- Your two most recent personal bank statements, every page
- Several months of business bank statements if you will use business money
- Your business license, registration or a letter from your CPA, if you have one
- 1099 forms from the last two years, if you receive them
- Photo ID and Social Security number
- A short letter explaining any income drop or gap
- Log in to your IRS online account so you can approve the lender’s transcript request quickly
Mistakes to avoid
- Shopping before talking to a lender. Self-employed files take longer. Get pre-approved first so you know your real number before you tour.
- Moving money around right before applying. Large transfers between business and personal accounts raise questions. Keep a clear paper trail, and ask your lender before moving big amounts.
- Filing late or amending returns mid-process. Lenders need the returns the IRS has. Talk to your lender before filing or amending anything during the loan.
- Missing pages on statements. Lenders want every page, even blank ones. Download full statements to save a week of back-and-forth.
- Taking on new debt before closing. A new truck, equipment loan or credit card can change your approval. Wait until after closing.
Brevard County in numbers
- The typical home in Brevard County is worth about $339,600, and 77% of homes are lived in by their owners.
- Typical rent here is about $1,556 a month, including utilities.
Free help
Questions people ask
Can I get a mortgage if I’m self-employed?
Yes; lenders usually look at your tax returns to see steady income.
Can I get a mortgage if I’m self-employed?
Yes. Lenders approve self-employed buyers all the time. They usually look at your last two years of tax returns to see steady income.
How long do I need to be self-employed to buy a house?
The common rule is a two-year history. Under Fannie Mae’s guide, you may qualify with less if your latest returns show a full 12 months in the business and you earned the same or more in similar work before.
Do lenders use my gross income or my net income?
Lenders mostly use the income on your tax returns after business expenses. Ask your lender to show you how they figured your number and whether any deductions were added back.
Will my write-offs hurt my mortgage approval?
They can, because they lower the income a lender can count. Talk to your tax preparer and lender before you file if you plan to buy soon.
What is a 4506-C?
It is an IRS form that lets your lender get your tax transcripts with your permission. You approve the request in your IRS online account.
Do I need a profit and loss statement?
Some lenders ask for a year-to-date profit and loss statement for the current year. Ask your lender early whether they need one and who should prepare it.
Can I use business money for my down payment?
Often yes, if the lender can see that the business will still be healthy. Expect to show several months of business statements.
Does my income drop last year mean I can’t qualify?
Not always. Lenders look at the trend and why it happened. A short, honest explanation helps.