W2 vs. 1099 Income for mortgages

[Account Closed]

What is the best way to qualify for a mortgage with 1099 income? How can you make it look like W2 income to banks?

[Chris Mason]

Originally posted by @Account Closed:

What is the best way to qualify for a mortgage with 1099 income? How can you make it look like W2 income to banks?

There is absolutely no rule or guideline prohibiting an independent contractor from obtaining a traditional residential mortgage. Usually what happens is that someone is being dishonest, about something. 

 - Have them hire you full time, as an employee and not a self-employed independent contractor. If someone is telling you that they are your employer but refusing to issue the W2 that any regular employee is entitled to, they may be committing tax fraud.

- If you truly are a self-employed independent contractor, then declare your income honestly when you do your taxes. If you want some of Aunt Fannie Mae's cheap money, then you need to be right with your Uncle Sam first. It turns out that Aunt Fannie and Uncle Sam talk to each other.

- If neither of the above works, then it's quite possible that consumer protection laws are getting in your way, which means the "no" is for your own good -- it's to prevent your own foreclosure.