Get the letter right before you make the offer
Preapproval when self-employed
Desk answer
Self-employed borrowers usually document income with personal and business tax returns, and lenders often average income over two years. Big write-offs lower qualifying income. Bringing complete returns, year-to-date figures and business account statements up front speeds the preapproval.
Last reviewed against the primary sources listed below.
Documents
- Personal and business tax returns.
- Year-to-date profit and loss.
- Business bank statements.
Questions buyers bring to the desk
How do lenders calculate self-employed income?
Usually from tax returns, often averaged over two years.
Do write-offs affect my mortgage approval?
Yes, they reduce the income lenders count.