If you’re self-employed in Texas, you already know the challenge: strong income, healthy business, but tax returns that don’t tell the whole story. Traditional banks often say no. The right mortgage broker says there’s another way.
I work with self-employed buyers, business owners, 1099 contractors, and entrepreneurs across North Texas every day. There are multiple mortgage programs designed specifically for your situation — and none of them require you to hand over two years of tax returns.
Why Traditional Mortgages Are Hard for Self-Employed Borrowers
Conventional mortgage underwriting is built around W-2 employees. It uses two years of tax returns to calculate qualifying income — which is a problem for most business owners who maximize write-offs to reduce taxable income.
The more deductions you take, the lower your qualifying income appears on paper — even when your actual cash flow is strong. That’s why so many self-employed borrowers get declined by retail banks despite being financially well-qualified.
Non-QM loan programs solve this by using different methods to document and verify income.
Self-Employed Mortgage Programs Available in Texas
Bank Statement Loans (12 or 24 Months)
Qualify using deposits from your personal or business bank accounts — no tax returns required. Ideal for business owners, consultants, and entrepreneurs whose write-offs reduce reported income. Loan amounts available up to jumbo limits.
1099-Only Loans
Qualify using one or two years of 1099 earnings. No bank statements or tax returns needed. Perfect for independent contractors, sales professionals, real estate agents, and gig economy workers.
Profit & Loss (P&L) Only Loans
Qualify using a CPA-prepared or borrower-prepared profit and loss statement. No bank statements or tax returns required. A clean, simple solution for self-employed buyers with straightforward business operations.
Asset Depletion / Asset-Only Loans
Have significant savings or investments but limited documented income? Asset depletion programs convert your liquid assets into qualifying income. Popular with retirees and high-net-worth self-employed borrowers.
DSCR Loans (For Investment Properties)
If you’re purchasing a rental property, DSCR loans qualify you based on the property’s rental income — not your personal income at all. No tax returns, no W-2s, no personal income documentation required.
Who Qualifies for a Self-Employed Mortgage in Texas?
These programs are a strong fit if you are:
- A sole proprietor, LLC owner, S-Corp, or partnership member
- A 1099 contractor or independent consultant
- A real estate agent, investor, or property manager
- A freelancer, creative professional, or gig worker
- A small business owner with strong deposits but low taxable income
- A high-income professional with complex tax returns
If your cash flow is solid but your tax returns don’t reflect it, you likely have more options than a traditional bank told you.
General Requirements for Self-Employed Mortgage Programs
- Credit Score: Typically 620-700+ depending on loan type and down payment
- Down Payment: 10-20% for most programs
- Bank Statements: 12 or 24 months of personal or business statements (bank statement loans)
- Reserves: 3-12 months of payment reserves often required
- Self-Employment History: Typically 2 years in the same line of business preferred
North Texas Markets We Serve
I work with self-employed borrowers throughout North Texas, including Frisco, McKinney, Celina, Prosper, Plano, Allen, Denton, Sherman, and surrounding Collin, Grayson, Denton, Rockwall, Tarrant, Cooke, and Fannin Counties.
Frequently Asked Questions
Can self-employed borrowers get a mortgage in Texas?
Yes. Self-employed borrowers can qualify using bank statement loans, 1099-only programs, profit and loss statements, or asset depletion — without traditional tax returns.
What is a bank statement loan?
A bank statement loan lets you qualify using 12 or 24 months of personal or business bank deposits instead of W-2s or tax returns. It’s ideal for business owners whose write-offs reduce taxable income.
How much do I need to put down as a self-employed borrower?
Most bank statement loans require 10-20% down. Some programs go as low as 10% with strong credit and reserves.
Do I need good credit to qualify?
Most Non-QM programs require a minimum credit score of 620-680. Higher scores unlock better rates and lower down payment options.
How long does it take to close?
Closings typically take 21-30 days. Having 12-24 months of bank statements ready upfront speeds the process significantly.
Let’s Find Your Path to Approval
Self-employed doesn’t mean unqualified. It means you need the right program and the right loan officer. I’m Wayne Wallace — SVP of Mortgage Solutions at Homewood Mortgage, LLC — and I’ve spent 27 years helping North Texas borrowers close loans that other lenders couldn’t figure out.
Homewood Mortgage, LLC | NMLS #294974 | Wayne Wallace NMLS #745186 | Licensed in Texas | This is not a commitment to lend. Loan programs subject to change. Not all borrowers will qualify.