Self-employed Home Loan Programs
Mortgage options made for small business owners, freelancers, and 1099 employees in Colorado
Buying a home in Colorado, whether in Boulder, Denver, or Fort Collins, offers a lifestyle as unique as each city. But if you are self-employed or run your own business, getting approved for a traditional mortgage can be difficult. Most lenders rely on tax returns which may understate your true income.
This is where a non-QM loan can help. These loans use either your bank statements, 1099s, or profit and loss statements to evaluate your income. For self-employed professionals and people with non-traditional income in Colorado, this loan type offers a better fit.
TABLE OF CONTENTS:
↓Why Non-QM Loans Work for Self-Employed Buyers
For many self-employed professionals in Colorado, tax returns do not reflect their true earning power. Business write-offs can significantly lower reported income, even when monthly cash flow is strong. Non-QM loans offer a way to work around this limitation by focusing on your actual income and cash flow, rather than your net income after business deductions. This helps level the playing field for business owners, freelancers, and independent contractors who might otherwise be denied by traditional lenders.
No Tax Return Loan Options for Self-Employed Borrowers
- Bank Statement Loans: Use personal or business deposits to show income
- 1099 Loans: Qualify with recent 1099 forms and YTD earnings
- P&L Loans: Use Profit & Loss statements for income verification instead of tax returns or bank statements
- No Ratio or Asset Based Loans: Skip income reporting entirely with $1 million plus liquid asset account balances
Bank Statement Loans in Colorado
Qualify using business or personal deposits — no tax returns needed
Quick Overview
- ✔ 12–24 months of business or personal bank statements
- ✔ No tax returns required
- ✔ Expense factor: 10%–50% based on the industry or CPA letter
- ✔ Works for business owners, LLC, corporation, DBA, consultants
Who benefits from the bank statement loan?
This loan program is designed for a wide range of borrowers who often don’t meet the strict criteria of traditional lenders. Here’s who it helps the most:
- - Self-employed professionals (freelancers, consultants, contractors, workers paid 1099, sole proprietors, realtors)
- - Business owners (small, medium, and large)
- - Real estate investors who have diverse sources of income
- - W2 salaried co-borrower with higher earning self-employed primary borrower
“Some of my past clients who benefited from the bank statement loan were a dentist, attorney, realtor, pharmaceutical sales rep., and a fast healthy food shop owner.” – William Cook, NMLS mortgage originator
Typical Requirements for Non-QM Loans
Buying: At least 10% down
Refinance: 15% equity or more.
P.I.T.I Reserves : 6-12 months
Occupancy: primary residence, second home, or rental property.
As of July 1, 2025 in order to qualify you will need to satisfy the above.
*1 year self-employment is allowed if you also worked 1 or more years as a salaried person in the same industry you are currently self-employed in now.
*Not Eligible: homes on 20.1 acres or more, zoned rural or agricultural.
- $150k to $3 million— 10-percent down (85 LTV to refinance) with 720 and up credit scores
- $1.5M to $2 million— 15-percent down (80 LTV to refinance) with 680-719 credit scores
- $2M to $3 million— 20 to 25 percent down (75-80 LTV for refi) with 680-699 credit scores
- $3M to $5 million — 25 to 35 percent down (65 LTV for refi) with 720 and higher credit scores
The above is for borrowers with the above FICO credit scores, primary home, and 6-12 months reserves. Lower credit scores or 2-4 units require a higher down payment.
Bank Statement Loan Calculator
Use this tool to estimate your qualifying income based on your total deposits and expense factor. Slide green button left or right for your expenses
Self-employed & Refinancing
Not only can you use a bank statement loan to purchase a home in Denver, Boulder, or other Colorado cities, but it’s also a great option to refinance your existing mortgage. If your W2 income situation has changed to self-employed since you originally bought your home, refinancing through a bank statement loan may help you secure more favorable terms, access cash-out refinancing options, or lower your monthly payments.
Example of How Bank Statement Loans Can Help
Meet Sophia. She's a graphic designer from Fort Collins, who has been self-employed for over six years. Like many small business owners, Sophia’s income fluctuates based on client work and her income on her tax returns didn’t accurately reflect her overall earnings. By using a bank statement loan, Sophia was able to present 12 months of personal and business bank statements showing consistent deposits from her design projects. This allowed her to qualify for a loan and purchase a home just in time to expand her business studio.
It doesn't matter which Colorado bank or credit union (or big national bank) you have an account with as long as you have online banking you can access the statements. If you don't bank online, a customer service rep. can still email them to you. We've dealt with all types of challenges. By the way, you may also use your Schwab or Fidelity brokerage checking accounts to qualify if that's where you deposit your business income.
Whether you're looking to purchase a new home or refinance your existing mortgage, bank statement loans offer a solution tailored to your self-employed income situation. Reach out to me today to find out if a bank statement loan is the right fit for you.
P & L Mortgage Loan
Do your bank statements show a negative trend? A P&L loan may be the solution.
Profit & Loss Loan Program
Under this non-QM loan product your most recent 1-2 years of profit & loss statements and YTD P&L statement are reviewed by the lender's underwriter.
Step 1: Request profit & loss statements from your tax preparer. Keep in mind there are some business expenses the underwriter adds back in unlike your filed tax returns such as specific depreciation, one-time non-recurring expenses, home office and a couple more.
The requirements for Profit & Loss loans are similar to those for bank statement mortgages. However, this option is better suited for borrowers whose bank deposits vary widely month to month or show a declining income trend.
1099 Mortgage Loans
A great loan for independent contractors who file a schedule C and want to use their 1099 forms to qualify for a mortgage.
1099 Non-Employee Home Loans
Under the 1099 non-QM loan, your most recent 1099 forms from the past one to two years are used to verify income along with a year-to-date income statement reviewed by underwriting. This option is especially helpful if you have gaps in your deposits such as three or more months without income showing in your bank account.
It's a good alternative to bank statement loans for independent contractors and gig workers with steady or irregular cash flow. Less documentation means less scrutiny. The documentation requirements for a 1099 loan are the same as a bank statement mortgage described above, but with one key difference. For example, the minimum down payment is 15-percent.
Areas Served
We serve borrowers throughout the state of Colorado which includes these cities:
- Boulder
- Denver
- Colorado Springs
- Fort Collins
- Longmont
- Broomfield
- Castle Rock
- Lakewood
- Englewood
- Centennial
- Parker
- Grand Junction
Disclosure: Minimum loan amount is $150,000 for residential. Loan programs are subject to change per lender at any time until the loan is approved and the rate is locked. Borrowers must be approved by underwriting. Not all applicants will qualify.