If you are self-employed, a 1099 contractor, or an owner with a stake in a business, you have probably been told your income is complicated. It usually is not. It is just documented differently than a W-2, and most lenders are not set up to read it. LuxPro Mortgage is a Troy-based lender that works these files across Metro Detroit and all of Michigan, and we will tell you in one conversation which program fits your situation and what it will actually cost.
Why Self-Employed Buyers Get Declined by Big Lenders
Traditional underwriting averages the net income on your last two years of tax returns. Every legitimate deduction you take — mileage, equipment, home office, depreciation, a Section 179 write-off on a truck — lowers that number. A contractor who deposited $240,000 last year can show $70,000 in qualifying income after a good accountant is finished, and a call-center lender will simply say no.
Nothing is wrong with your business. The wrong document is being read. The programs below fix that by measuring cash flow instead.
Bank Statement Loans
Instead of tax returns, we use 12 or 24 months of bank statements and calculate qualifying income from your actual deposits, applying an expense factor for your industry. Personal or business accounts can be used depending on the program.
- 12 or 24 months of statements instead of tax returns
- Built for business owners, contractors, realtors, salon and restaurant owners, trades, and consultants
- Available for purchases, refinances, and cash-out
- Primary residences, second homes, and investment property
- Generally requires two years of self-employment history
1099 and Profit & Loss Programs
If most of your income arrives on 1099s, some programs qualify you directly from those forms with a standard expense factor, which is often simpler than a bank statement review. Other programs accept a CPA-prepared profit and loss statement, sometimes paired with a shorter set of statements. Which is cheapest depends on your deposit pattern and how your accountant structures things — we run the options rather than defaulting to one.
Do Not Skip Conventional
Plenty of self-employed buyers assume they need an alternative program and end up paying for one unnecessarily. If your returns show enough income, conventional financing is almost always cheaper, and there are legitimate add-backs — depreciation, depletion, amortization, some one-time expenses — that raise your qualifying income above the bottom line on the return.
We check conventional first, every time. If it works, we tell you, even though the alternative program would earn us more. If it does not, we move to the programs above with the numbers already in hand.
Investors and Rental Property
For rental purchases there is a further option that skips personal income entirely: qualifying on the property's own rent against its payment. That is useful for owners whose returns are complex or who are buying through an entity. If your goal is portfolio growth rather than a primary residence, mention it early and we will structure the file accordingly.
How It Works
- 1
One honest conversation first
Tell us how you are paid and roughly what you deposit. Before you gather a single document we will tell you which programs fit and which do not.
- 2
We check conventional before anything else
If your tax returns support the loan, that is usually the cheapest path and we will say so. Alternative programs exist for when they do not, not as a default.
- 3
Pre-approval, then close on time
You get a pre-approval letter you can shop with and the same loan officer from application through closing — someone who already understands your income structure.
Why Michigan Borrowers Choose LuxPro Mortgage
- Pre-approved in 1 business day
- No hidden fees — ever
- 5.0-star rated on Google & Zillow
- Licensed Michigan lender — NMLS# 1861721
- Same loan officer from application to closing
- Serving all of Michigan
Frequently Asked Questions
Can I get a mortgage in Michigan if I am self-employed with low taxable income?
Yes. Bank statement, 1099, and profit-and-loss programs qualify you on the money moving through your accounts rather than the net figure on your return. A business owner whose return shows modest income can still qualify on strong deposits. Bring us a rough monthly deposit number and we can tell you quickly where you stand.
How many months of bank statements do I need?
Usually 12 or 24 months, and the choice affects pricing. Twelve months is faster to gather and often enough; twenty-four can improve terms for some borrowers. Personal or business accounts may be used depending on the program.
How long do I need to be self-employed to qualify?
Two years of self-employment history is the general expectation. Some situations are treated more flexibly, particularly when you moved from a W-2 job into the same line of work, or when you have a longer history in the industry. It is worth a conversation rather than an assumption.
Do self-employed mortgages have higher rates?
Alternative documentation programs typically price higher than conventional financing, because the lender is accepting a different form of income proof. That is exactly why we check conventional first — if your returns support the loan, you should take the cheaper option. When they do not, the alternative program is what makes the purchase possible at all, and we will show you the real cost of both.
Can I use a bank statement loan for a rental or investment property?
Yes, and for rentals there is often a better route that qualifies on the property's own rental income instead of your personal income. Tell us the property and the strategy and we will structure it the cheaper way.
What documents should I have ready?
Start with 12 to 24 months of bank statements, your two most recent tax returns if you have them, any 1099s, and a business license or CPA letter confirming your self-employment. You do not need all of it to start — a first conversation only needs a rough deposit figure.
Explore More Michigan Loan Programs
Ready to Get Started?
Talk to a local Michigan loan expert today — no hidden fees, no 1-800 runaround, and pre-approval in one business day.