Self Employed Home Loans for Entrepreneurs

A bank statement mortgage loan lets you qualify for a home using your bank statements instead of W-2s or tax returns. It is for small business owners, freelancers, and contractors who want a mortgage that reflects real income, not just paperwork.

Yes. You don’t need traditional W-2 income. Bank statement loans focus on real deposits and cash flow, which makes it easier for self-employed borrowers to get approved quickly and refinance later if desired.

Deposits matter most. Self-employed home lenders review your total monthly deposits to verify cash flow and income consistency. For self-employed home loans, qualification is based on actual revenue, not what’s reported after taking an aggressive tax planning strategy. Self-employed mortgage lenders will take into account expenses, but they typically rely on a CPA-verified expense ratio to help determine qualifying income accurately.

You can calculate your self-employed income by taking an average of all your deposits over the 12 or 24-month period of bank statements and then deducting an expense ratio (provided by your CPA). For instance, if your average monthly gross receipts are $30,000 and your expense ratio is 20%, your "income" will be roughly $24,000. LendFriend can handle this calculation for you.

Yes. Bank statement loans are ideal for multiple businesses, 1099 income, side hustles, or freelance work. We’ll structure your application to reflect your full income picture, so you can qualify based on everything you earn.

Yes, you can still qualify for a mortgage if you started your business at least 1 year ago. Self-employed home lenders want to see consistency, stability, and the likelihood that your income will continue, especially if your new business builds on prior experience in the same industry.

Typically, lenders will require a down payment of at least 15% when purchasing a home using a bank statement loan, although 20% will give you access to much better pricing.

Bank statement loans require a 700+ credit score, since these are non-QM loans designed for high-net-worth borrowers using alternative income documentation. However, if you want the best rate, you should aim for a 780+ credit score.

Non-QM lending is useful for borrowers with income that doesn’t meet conventional guidelines, such as self-employed individuals, real estate investors, or those relying on assets. Programs like bank statement loans or asset-based lending provide flexibility. 

Alternative financing options include bank statement loans, asset-based programs, and portfolio lending. For short-term needs, bridge loans and hard money loans may also apply. These alternative loan options for self-employed borrowers address income fluctuations and offer more flexible qualification paths compared to standard mortgages.