Need taxable income to pursue househacking?

Question

Hello all! For the past three years or so I have been very interested in doing a house hack. I am in college and just starting my junior year. I have around 20 -25k to invest into a house hack in Lafayette, Louisiana. My predicament? Taxable income. I want to buy a deal that will work and cash flow and I figure the best way to do that is to go conventional with an fha loan. I have been putting this off since I started college and I have decided I want to pick up a property in the next 6 months. I have an opportunity to start reporting 1099 income for my job. Will it be possible to make it happen if I start reporting income now?? Thanks!

Andrew Postell · Answer

@Bruce P. Bellott if you want to go conventional or FHA you will have to be a 1099 employee for at least 2 years.  Technically, you would need two years of filed tax returns reflecting that income so they could calculate the income.  Keep in mind that FHA/VA/USDA/Fannie Mae/Freddie Mac....they are all Federal Government.  So the Federal Government wants to see your Federal Tax returns.  Now, if you got out of college and got a W2 job, then that income would be used right away (as long as it has some relationship to your degree).  Hope this helps in some way.

Mason Hickman · Answer

@Bruce P. Bellott

Typically lenders are looking for 2 years of consistent income history if you are a 1099 contractor. If you working a w-2 as well, that would give you a better chance for your timeline.