Mortgage Navigator • Conventional • Self-Employment
Schedule C / sole-proprietor income
Taxable profit is the starting point—not always the final qualifying income.
Cash-flow analysis
Agency self-employment analysis starts with tax-return income and then applies the permitted cash-flow adjustments. Certain non-cash expenses can potentially be added back, while recurring obligations and non-recurring income may need adjustment.
Business trend
The lender must look beyond a single bottom-line number and evaluate whether gross income, expenses and taxable income support the conclusion that earnings are stable.
Fannie vs. Freddie: both agencies require a defensible cash-flow analysis, but use their own guide instructions and analysis tools. Do not assume every Form 1084 adjustment is automatically a Freddie calculation rule.
Official guide baseline
Fannie Mae Selling Guide · Freddie Mac Seller/Servicer Guide
Agency guide and AUS findings control. Tax-return, business-analysis and lender-overlay requirements can change the usable income.