Can a General Contractor Obtain a No Income Verification Mortgage?

Tax returns for self-employed professionals can be complicated. Deductions, write-offs, and expenses may leave your adjusted taxable income looking much lower than what the business actually brings in throughout the given year. That’s where a no income verification mortgage can achieve provide a solution. With a no income verification home loan, we will not need any W2s, nor paystubs nor tax returns. Now, you can breathe a little easier and read on.

Primary Homes vs. Investment Properties

The right loan program often depends on your goals. If you’re buying a home for yourself and your family, we can review specific no income verification mortgage options that will utilize the business cashflow to help qualify. This commonly needs a 10% to 15% down payment and can utilize your top line revenues of the business.

If you already own a home and are looking to buy an investment property, we can utilize the investor cashflow program which we'll go over shortly.

Obtaining a No Income Verification Mortgage for a Primary Residence

As a general contractor and a business owner, you can have an advantage that you have additional options to help qualify for a mortgage. Rather than analyzing taxable income, we can review deposits into your business bank account. Each month, you're most likely depositing checks, cash, Zelle payments and perhaps receiving wires from customers. Those deposits appear on the bank statements and will help you in the process. Typically, twelve months of business bank statements are reviewed, and an underwriter calculates the average monthly deposits.

Let’s take an example. Suppose you have owned your general contracting company for ten years and the business generates about $60,000 in revenue each month. Over twelve months, that adds up to $720,000. When underwriting reviews your statements, they may use roughly half of that amount, which is around $30,000 per month, or $360,000 annually for qualifying income. This business minded approach acknowledges the company’s strong cash flow and paints a different picture than simply reviewing a set of tax returns.

This is where the business cash flow program becomes especially valuable. While your tax returns might tell a different story, often showing far less due to deductions, you are not penalized for running your business efficiently. The program is designed specifically for self-employed individuals (i.e. general contractors, pool construction business owners, electrical company business owners, roofing company business owners, etc) who have consistent revenue, good credit and the ability to make a reasonable down payment, usually at least 10%.

Purchasing an Investment Property as a General Contractor

If you already own your home and want to expand into real estate investing, we have an additional option to help with the property financing. In that case, we can also look at an investor cashflow program, often called a DSCR loan. With this program, there are no tax returns, no W2s, no paystubs and not an analysis of twelve months of business bank statements as mentioned with the bank statement program.