Self-employed borrowers
Tax returns matter—but the real underwriting question is whether the business income is stable, accessible and likely to continue.
Explore self-employment
How long must you be self-employed?
Two years is the norm, but one full year can work in the right circumstances.
One year vs. two years of returns
When Fannie permits one year and when more documentation is required.
Schedule C / sole proprietor
How taxable income is adjusted for qualifying.
K-1 / partnership / S-corp
Ownership, distributions, access and liquidity.
Business liquidity
Why taxable business income is not automatically usable personal income.
Using business funds to close
When taking money from the business can create a new underwriting problem.
Declining self-employed income
Trend analysis and current business performance.
Self-employment not used to qualify
When a side business may require less analysis.
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.