Can I get a mortgage as a 1099 independent contractor?
Yes. The 1099 mortgage program qualifies independent contractors on gross 1099 income averaged over 24 months — no Schedule C reduction, no W-2 required. Two years of 1099 forms are the primary income document.
By Sunrise Lending
Why the answer is yes — and what it requires
Why conventional mortgages fail 1099 earners
Conventional underwriting treats 1099 income as self-employment income under the Schedule C framework. The lender opens your tax return, finds your gross 1099 income, applies Schedule C deductions, and qualifies you on the net figure. The net is often 40–60% of gross, because legitimate business deductions — home office, mileage, professional subscriptions, equipment, health insurance, retirement contributions — reduce the qualifying figure substantially.
A top-producing real estate agent with $220,000 in gross commission income and a competently prepared Schedule C might show $90,000 in net self-employed income — qualifying at $7,500/month rather than the $18,333/month their actual commission income would support.
How the 1099 loan program works
The 1099 program qualifies on gross contract income — the top-line 1099 figure before any Schedule C deductions. Specifically:
1. The lender collects 24 months of 1099-MISC or 1099-NEC forms from all payers. 2. Total gross 1099 income is averaged over 24 months. 3. A modest expense-factor adjustment (typically 5–10%) is applied to reflect minimal overhead. 4. The result is qualifying monthly income for DTI math.
On $220,000 in gross commission income over 24 months: $220,000 ÷ 24 = $9,167/month gross, minus 10% expense = $8,250/month qualifying income. Compare to the conventional Schedule C path's $7,500/month — this is a meaningful difference on a high-cost purchase.
Who qualifies
Real estate agents, attorneys in solo practice or small firms, IT consultants, marketing consultants, independent healthcare providers, insurance agents, freelance designers, and any other professional whose income is reported on 1099-MISC or 1099-NEC forms.
Multiple payers are fine — the program aggregates all 1099s from all sources. You don't need a single primary payer or a consistent client mix year to year.
Hybrid path: 1099 + bank statements
For contractors with strong deposits in a business account, a hybrid file that layers bank statement income on top of 1099 income sometimes produces higher qualifying income than either path alone. The 60-second check-in evaluates both configurations.
Caveats and exceptions
- Most programs require 24 months of 1099 history. Some accept 12 months for established earners with prior W-2 history in the same industry.
- Year-to-year variation is smoothed by the 24-month average — one strong or weak year doesn't dominate the calculation.
- A CPA letter documenting actual expenses lower than the standard adjustment can override the default and increase qualifying income.
- 1099 programs carry a modest rate premium over conventional. The tradeoff is qualifying on gross contract income rather than depressed Schedule C net.
Related questions
How does the 1099 loan calculate income from multiple clients?
All 1099 forms from all payers are summed to arrive at gross contract income. Multiple platforms, multiple clients, multiple 1099 form types — all counted in the gross total.
Full answerDo real estate agents qualify for 1099 mortgage programs?
Yes — real estate agents are among the most common 1099-borrower profiles. Commission income on 1099-MISC or 1099-NEC qualifies. Two years of history is standard; one year may work with prior W-2 evidence in the industry.
Can I combine 1099 income with W-2 income from my spouse?
Yes. On a joint application, the W-2 spouse qualifies on W-2 documentation; the 1099 spouse qualifies on 1099 documentation. Both incomes combine for DTI purposes.
Full answerWhat if my income has grown significantly in the past year?
Some programs accept a 12-month average for established earners with clearly trending income. Ask your officer whether your file meets the criteria for the shorter look-back.
What credit score do I need for a 1099 loan?
1099 programs typically start at 660. Best pricing at 720+. The check-in asks for a score band to narrow you to programs your profile qualifies for.
Full answerRelated resources
Sources
- 1.Internal Revenue Service (IRS). About Form 1099-NEC, Nonemployee Compensation — Accessed June 2026
- 2.Consumer Financial Protection Bureau (CFPB). Ability-to-Repay and Qualified Mortgage Standards — Accessed June 2026
- 3.U.S. Small Business Administration (SBA). Independent Contractors and Self-Employment — Accessed June 2026
Ready to find your path?
Take the 60-second check-in. Five questions about how you earn, what you own, and what you're trying to do. The matcher surfaces the program most likely to work. A licensed officer reviews before anything formal moves.
Sunrise Lending · Equal Housing Opportunity. Matching rules are written and reviewed by licensed mortgage professionals. All loan decisions are made by licensed mortgage professionals. Not a commitment to lend. Loan approval subject to underwriting guidelines. This is not financial advice.