Free to Move:Apply for A Mortgage As A Freelancer

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Real Estate

If you’re self-employed (or a contract employee) and you want to take out a mortgage, there are a few slight differences to the process that you might need to consider. To ensure that things go smoothly, Realtor Margo Laustsen outlines what to consider.


As a freelancer, due to the impermanent nature of your work, there are certain requirements that you may need to meet that salaried workers will not.


● The Mortgage Reports notes that income stability is paramount and you’ll need to be able to prove you have two to three years of income history ● The financial strength of your business may be assessed as well as its ability to generate revenue moving forward

● Like with salaried workers, you’ll need to provide a down payment of up to 20%


To prove a history of uninterrupted self-employment income (usually over two years), you’ll need to provide the right paperwork.

● points out that employment verification may include current clients, business licenses, and insurance contracts

● Income documentation includes personal tax returns, bank statements (maybe from your business bank account), and profit/loss statements, including potentially Schedule C, Forms 1120S or K-1 ● A personal accountant willing to verify the aforementioned documents

Mortgage Types

It’s important to get to grips with the varying types of mortgage, available to both freelancers and salaried workers

● Conventional loans are bracketed into either ‘conforming’ or ‘non-conforming’ with regard to Federal Housing Finance Agency (FHFA) standards ● If you have outstanding credit and you earn enough, you can apply for a ‘jumbo loan’ that will be disregarded by FHFA standards ● Alternatively, a smaller down payment can be partly subsidized with a government loan

As a freelancer, just as with a salaried worker, there are varying levels of complications when it comes to applying for a mortgage. To give yourself the best shot, it’s important to be organized and ensure you have all the right paperwork.

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You can rely on Realtor Margo Laustsen of Margo Tahoe Homes and Coldwell Banker to help you sell or buy your dream home in the Tahoe and Truckee area. Team up with Margo today 530.386.4463