Getting a Mortgage if You’re Self-Employed or a Gig Worker

Oct 7 2021

Applying for a mortgage is complicated for most, let alone if you’re self-employed or a gig worker. Rest assured that it’s totally doable, it may just take a little extra legwork.

Here’s what to know and how to prepare: 

What’s the difference?  

If you’re self-employed, a freelancer, or a gig worker, you earn what lenders call non-traditional income.

This just means you’ll need to provide your own income verification documents to a lender.

You’ll fill out the same mortgage application as everyone else, and lenders consider the same information to make their decision: 

  • Credit history 
  • Debt 
  • Assets 
  • Income  

What lenders look for 

Lenders want to know that all applicants, including self-employed workers, can repay their loans. They’ll evaluate whether your income is reliable enough to consistently make your monthly mortgage payments, property taxes, and insurance. 


  • You’ll need to have been in business for at least 12 months and will need to provide verification for your two most recent years of employment
  • You may also be asked to explain seasonal variations or other income changes that some self-employed folks experience throughout the year

“The biggest challenge here is that many small business owners don’t actually have a business,” says Katherine Peoples, executive director at HPP CARES, a nonprofit consumer credit, debt, and housing counseling agency in Los Angeles. 

“They haven’t set up their corporate structure correctly to be viewed as a business, and they also tend to want to write everything off on their taxes,” Peoples adds. In other words, the more deductions you take, the lower your documented net income will be. 

New requirements 

Some mortgage lenders tightened their credit standards due to COVID-19, so you may need extra proof of income these days.  

Along with the typical documentation (listed above), lenders may also ask for the following: 

  • Audited year-to-date profit and loss statement: Also called an income statement, profit and loss is a financial statement showing how much money you made and how much you spent for a particular period, such as a month, quarter, or year. You can have a certified public accountant (CPA) audit your profit and loss statement, during which they’ll test and validate the accounting system and financial information used to create it. If you need more information, the Small Business Administration offers tips on small business accounting.
  • Unaudited year-to-date profit and loss statement: Rather than being officially audited, this is signed by the borrower. It reports business revenue, expenses, and net income up to and including the month before you apply for a loan. 
  • Two business account statements: Ideally, you’ll have a separate bank account for your business showing your deposits and expenses. The two business account statements in your mortgage application should be from the most recent two months listed on your year-to-date profit and loss statement. For example, for a year-to-date profit and loss statement dated through May 31, 2020, the bank account statements should be no older than April 2020-May 2020.

Self-employed and gig workers buy houses all the time. Preparing the documents you’ll need as early as possible can make your mortgage application easier and get you closer to homeownership.

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