Question 1

Can I qualify for a 1099 Loan if I've only been self-employed for one year?

Accepted Answer

No. Most 1099 lenders require two years of self-employment history and two years of filed tax returns. Some portfolio lenders accept one year with strong compensating factors, but correspondent lenders—the faster option—won't budge.

Question 2

Does my Schedule C net profit have to match my actual take-home pay?

Accepted Answer

No. Your qualifying income is Schedule C net profit after business deductions. If you made $150,000 gross and deducted $50,000 in legitimate expenses, you qualify on $100,000.

Question 3

What down payment do I need for a 1099 Loan in Patterson?

Accepted Answer

Typically 10% minimum. Some lenders go 5% if you have strong credit (680+), reserves, or a co-borrower. A $500,000 home would need $50,000 down at 10%. Rates improve at 15% or 20% down, same as conventional loans.

Question 4

How long does underwriting take for a 1099 Loan?

Accepted Answer

30 to 45 days is standard. Conventional W-2 loans close in 21 days. The extra time comes from lender review of your tax returns, business structure, and income stability. A broker who submits clean files can sometimes accelerate to 35 days.

Question 5

Will a 1099 Loan cost more than a conventional loan?

Accepted Answer

Yes, typically 0.25% to 0.5% higher in rate. You're paying for the extra underwriting and the lender's risk on self-employed income. If you qualify for conventional, compare both. If you don't have two years of W-2 history, 1099 is your only option.

1099 Loans in Patterson: Self-Employed Homebuying Made Real