📊 Self-Employed or Salaried? What Lenders Look for in Your Income 💸

💼 W-2 vs. 1099 Income: How It Impacts Your Mortgage Approval 🏡

June 20, 2025•2 min read

💼 W-2 vs. 1099 Income: How It Impacts Your Mortgage Approval 🏡

📊 Self-Employed or Salaried? What Lenders Look for in Your Income 💸

💼 W-2 vs. 1099 Income: How It Affects Your Home Loan

When it comes to buying a home, how you earn your income matters—a lot. Whether you're a salaried W-2 employee or a self-employed 1099 contractor can drastically change the mortgage process and the documentation you'll need.

✅ W-2 Income: The Lender’s Favorite

W-2 income is often seen as more stable and predictable, which makes it easier to verify. Lenders typically only need:

· Your last two years of W-2s

· 30 days of pay stubs

· Recent bank statements

If your employment is consistent, you’re usually approved quicker with fewer hurdles.

⚠️ 1099 Income: More Paperwork, More Scrutiny

Self-employed borrowers or independent contractors are usually paid with 1099s. That means lenders will ask for:

· 2 years of personal and business tax returns

· Profit & loss statements

· Business bank statements

· Possibly a CPA letter

Lenders want to see that your income is consistent and sustainable over time. This can lead to more documentation and a longer underwriting process.

🏡 Can You Still Qualify with 1099 Income?

Absolutely. In fact, many lenders (including us at Medallion Mortgage) offer bank statement loans or non-QM products that cater specifically to 1099 workers. These programs allow you to qualify without tax returns, focusing instead on your cash flow.

🧮 Key Differences at a Glance:

Criteria

W-2 Borrowers

1099 Borrowers

Docs Required

W-2s + Pay Stubs

Tax Returns + P&L + Bank Statements

Approval Time

Faster

Longer

Income Scrutiny

Minimal

High

Program Options

Conventional, FHA, VA

Bank Statement, DSCR, Non-QM

🧠 Final Thought:

Whether you’re clocking in or running your own business, you can buy a home. You just need the right mortgage strategy—and the right broker to guide you.

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Bill Rapp - Commercial & Residential Mortgage Broker

Whether you're a first-time homebuyer, a seasoned investor, or a business owner with ambitious plans, securing the right financing is crucial. At Medallion Funds, we take the guesswork out of mortgages, offering a comprehensive suite of residential and commercial loan options to fit your unique needs. Looking for Your Dream Home? We understand the excitement and challenges of navigating the residential real estate market. Our experienced mortgage brokers will guide you through every step, from pre-qualification to closing. We offer a variety of loan programs to suit your financial situation, including: • Fixed-rate mortgages: Offering stability with predictable monthly payments. • Adjustable-rate mortgages (ARMs): Providing competitive rates for a set period. • FHA loans: Making homeownership accessible with lower down payments. • VA loans: Rewarding veterans with attractive rates and flexible terms. Investing in Your Business Future? Growth often requires capital, and we can help you unlock the potential of your commercial property. Our brokers specialize in a wide range of commercial loan options, including: • Purchase loans: Financing the acquisition of new buildings or land. • Construction loans: Facilitating the development of your project. • Refinance loans: Restructuring your existing mortgage for better terms. • SBA loans: Providing access to government-backed financing for qualified businesses. The Medallion Funds Difference: We go beyond simply finding a loan. We take the time to understand your goals and develop a personalized strategy. Here's what sets us apart: • Expertise: Our brokers have a deep understanding of both residential and commercial lending. • Competitive Rates: We leverage our strong lender relationships to secure the best possible terms. • Streamlined Process: We handle the paperwork, keeping you informed every step of the way. • Exceptional Service: We're committed to providing you with a positive and stress-free experience. Ready to Take the First Step? Contact Medallion Funds today for a free consultation. Let's discuss your financing needs and help you achieve your dreams!

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