Is there a mortgage loan program available for people who have been self-employed for 1 year?

Yes, there are mortgage loan programs available for individuals who have been self-employed for at least one year. While the specific requirements and availability of these programs may vary among lenders and countries, there are generally options for self-employed individuals to obtain a mortgage loan.

When applying for a mortgage as a self-employed borrower, lenders typically consider various factors to assess your eligibility and determine the loan terms. These factors may include your income stability, credit history, debt-to-income ratio, and the overall financial health of your business. Here are a few common types of mortgage loans that self-employed individuals can explore:

  1. Bank Statement Loans: Some lenders offer bank statement loans that allow self-employed borrowers to qualify based on their bank statements instead of traditional income documentation. These loans typically require providing several months' worth of personal and business bank statements to demonstrate a consistent income.

  2. Stated Income Loans: Stated income loans, also known as no-documentation or low-documentation loans, allow borrowers to state their income without providing extensive verification. However, since the financial crisis of 2008, these types of loans have become less common and may have stricter requirements.

  3. Portfolio Loans: Portfolio loans are mortgage loans held by a lender instead of being sold on the secondary market. They offer more flexibility in underwriting criteria and may be suitable for self-employed individuals with non-traditional income documentation.

  4. FHA Loans: The Federal Housing Administration (FHA) offers loans with more flexible qualification criteria, including for self-employed borrowers. They consider self-employment income, but you will need to provide tax returns, profit-and-loss statements, and other relevant financial documentation.

  5. Conventional Loans: Conventional mortgage loans backed by Fannie Mae or Freddie Mac also consider self-employed income. However, you will typically need to provide two years of tax returns and other financial documents to verify your income stability.

It's important to note that lenders may have specific requirements and additional documentation needed for self-employed borrowers. Working with a mortgage broker or loan officer experienced in dealing with self-employed individuals can help you navigate the process and find the best loan program for your situation.

* Specific loan program availability and requirements may vary. Please get in touch with your mortgage advisor for more information.