See if you qualify, free, 60-second check.
Yes, a real estate agent can buy a home on commission income even when the tax return looks thin. A bank statement loan for realtors qualifies you on the money that actually lands in your account, not the net figure left after every Schedule C write-off. For a lot of agents, that single change turns a denial into an approval.
The problem is familiar. You close 25 deals a year, gross six figures, then deduct mileage, MLS dues, brokerage splits, staging, marketing, and a car that doubles as a mobile office. Smart tax planning. Terrible mortgage optics. A conventional underwriter reads the bottom line and sees a fraction of what you earn.
Two non-QM products fix that gap: the bank statement loan and the 1099 loan. Most producing agents qualify for at least one. Below is how each works, the math behind them, and how to line up your file before you apply.
Conventional loans (the Fannie Mae and Freddie Mac kind) judge a self-employed borrower on net business income. Underwriters pull your last two years of returns, average the profit after deductions, and call that your income. For a W-2 employee that math is fair. For a commission agent who writes off aggressively, it punishes good bookkeeping.
Say you grossed $180,000 in commissions last year. After mileage, marketing, brokerage fees, license renewals, CE courses, and a home office, your Schedule C nets $70,000. Conventional underwriting uses the $70,000. At current guidelines that might support a mortgage payment around $1,600 a month. The house you actually want needs $2,600. Denied, or approved for far less than you can comfortably afford.
Nothing about your business changed. Only the number the lender chose to look at. That is the whole reason non-QM lending exists: to price the borrower on cash flow rather than a tax form written to minimize taxable income.
A quick reality check first. If you barely deduct anything and your net income is strong, a conventional loan is usually cheaper and you should take it. Bank statement and 1099 loans are for agents whose write-offs bury their real earning power. Run both paths before you commit.
A bank statement loan skips tax returns entirely. Instead, the lender reviews 12 to 24 months of your bank statements and calculates income from the deposits that hit your account. Commission checks, referral fees, whatever the business actually brought in.
Lenders do not count every dollar as income. They apply an expense factor to account for the cost of running your business. A common default is 50 percent, meaning half of your deposits are treated as qualifying income. Some lenders lower that factor to 20 or 30 percent if you can show, often with a CPA letter, that your real overhead is lower. The exact method is worth understanding in detail, and we break the arithmetic down in our guide on how bank statement loan income is calculated.
Picture a listing agent named Dana. Over the last 12 months, her business checking account received $210,000 in deposits, mostly commission wires from her brokerage. Here is roughly how a personal bank statement program would size her income:
Compare that to the $70,000 her tax return showed after write-offs. The bank statement method credits her with $35,000 more in qualifying income, which is easily the difference between the house she wants and the one she settles for. If Dana routes deposits through a business account, some lenders use a lower expense factor and her number climbs higher still.
The full checklist, including how lenders treat transfers and irregular deposits, lives in our bank statement mortgage requirements breakdown.
If most of your income arrives on 1099 forms, a 1099 loan can be simpler than gathering two years of statements. Instead of averaging deposits, the lender takes the gross income reported on your 1099s and applies a flat expense factor, commonly around 10 percent, to arrive at qualifying income.
That thinner haircut is the appeal. A bank statement program might strip 50 percent off your deposits. A 1099 program might strip only 10 percent off your gross. For agents who receive clean 1099s from their brokerage, the 1099 route often produces a higher qualifying income with less paperwork.
| Feature | Bank statement loan | 1099 loan |
|---|---|---|
| Income proof | 12-24 months of statements | 1-2 years of 1099 forms |
| Typical expense factor | ~50% (sometimes 20-30%) | ~10% |
| Best when | Deposits are strong and consistent | You get clean 1099s from a brokerage |
| Paperwork load | Higher | Lower |
| Tax returns required | No | No |
Run Dana through a 1099 program. If her brokerage issued 1099s totaling $195,000, a 10 percent factor leaves $175,500 in qualifying income, roughly $14,625 a month. That's dramatically more than either her tax return or the bank statement method. Which product wins depends on how your income is reported and how consistent your deposits look, so it pays to price both.
Not every agent gets 1099s that add up cleanly. Referral income, team splits, and multiple brokerages can muddy the picture, and that's exactly when the bank statement approach earns its keep.
Let's put real numbers side by side so the choice is concrete. Meet Marco, a Dallas buyer's agent with four years in the business, a 712 credit score, and $60,000 saved for a down payment and reserves. He wants a $450,000 home and plans to put 15 percent down.
| Method | Income shown | Qualifying monthly income |
|---|---|---|
| Conventional (tax return net) | $68,000/yr | ~$5,670 |
| Bank statement (50% factor on $200k deposits) | $100,000/yr | ~$8,330 |
| 1099 loan (10% factor on $190k gross) | $171,000/yr | ~$14,250 |
On the conventional number, Marco's debt-to-income ratio blows past the limit once you add his car payment and student loan. Denied. On the bank statement number, he qualifies with room to spare. On the 1099 number, he qualifies easily and could even shop a larger home.
Same agent, same year, three very different outcomes. The only variable is which income method the loan uses. That is the practical takeaway: your approval often hinges less on how much you earn and more on which door you walk through.
Costs differ too. Non-QM loans carry higher rates than conventional financing because the lender takes on more risk without tax-return verification. How much higher depends on your credit, down payment, and reserves. We don't quote live numbers here, but you can see current ranges on our rates page.
Most avoidable denials trace back to a handful of habits. Fix these before you apply.
None of these are about how good an agent you are. They're bookkeeping and timing, and every one is fixable.
Bank statement and 1099 loans aren't the only routes for a self-employed buyer. Here's how they stack up against the alternatives so you can see where they fit.
Conventional wins on rate and cost every time your net tax income is strong enough to qualify. If your write-offs are modest, take the conventional loan. The non-QM options exist for when deductions hide your true cash flow.
Agents who bought before 2008 remember stated-income loans, where you simply declared your income with no proof. Those are gone. Bank statement loans are the regulated, documented successor, and we cover the distinction in stated income loans in Texas. The key difference: today you prove income with real deposits, so the loan is far more stable.
Buying a rental instead of a primary home? A DSCR loan qualifies on the property's rent, not your personal income at all. That's a different tool for a different job, covered in our DSCR loans in Texas guide. For your own residence, stick with bank statement or 1099 financing.
If you want to see the broader category first, what is a bank statement loan gives the plain-English overview before you dig into which flavor suits you.
Not every agent's income looks the same, and the right loan bends to fit.
If you run a team or own a brokerage, your deposits may include agent splits, franchise fees passing through, and operating costs that aren't really your income. A generic 50 percent expense factor might understate or overstate your true earnings. This is where a CPA-prepared profit-and-loss statement helps. Some programs use a P&L alongside the statements to set a more accurate factor, which can raise your qualifying income if your real margins are healthy.
The standard ask is roughly two years of commission income. If you switched from a salaried job into real estate 14 months ago and you're producing well, don't assume you're locked out. Some lenders will look at a shorter track record when your deposits are strong, your credit is clean, and you have solid reserves. You may face a slightly higher rate or a larger down payment, but the door isn't closed.
Plenty of agents buy on a bank statement loan, build equity, and later refinance, sometimes into a lower rate, sometimes to pull cash out for the business. Texas has specific rules for tapping home equity, and we cover them in our bank statement mortgage refinance guide and the Texas cash-out refinance rules. Worth knowing the exit before you enter.
A little preparation turns a shaky file into a clean approval. Work through this in the months before you apply.
You don't need to figure this out alone. Start with the free 60-second eligibility check to see which path fits your numbers, then read how it works for the full process from application to closing. When you're ready, the application takes just a few minutes, and you can model scenarios first with our calculators.
The agent who sells homes for a living deserves a clean shot at buying one. With the right income method, that's exactly what these loans give you.
See what you qualify for in 60 seconds, free and no credit check. Use the eligibility check at the top of this page.
Conventional loans use your net income after write-offs. Heavy deductions on your Schedule C shrink that number, so an underwriter sees a fraction of what you actually earn. A bank statement or 1099 loan qualifies you on gross cash flow instead.
It depends on how your income is reported. A 1099 loan applies a small expense factor, around 10 percent, to your gross 1099 income and usually needs less paperwork. A bank statement loan reviews 12 to 24 months of deposits with a larger factor, often 50 percent. Price both, because the difference in qualifying income can be large.
Most programs ask for 12 to 24 months of consecutive statements. If your commission income is seasonal or lumpy, the 24-month window often smooths the swings and produces a stronger average.
You can use bank statement or 1099 financing for a primary or second home. For a pure investment property, a DSCR loan that qualifies on the property's rent is usually the better fit. See our DSCR loans guide for that scenario.
Plan on at least 10 percent, and more often 15 to 20 percent depending on your credit score and reserves. A larger down payment can also improve your rate.
Usually yes, lenders want to see about two years of commission or self-employment history. Some programs consider borrowers with a shorter track record if the rest of the file is strong, so it's worth asking.
Typically yes. Non-QM loans carry higher rates because the lender verifies income without tax returns and takes on more risk. Your exact pricing depends on credit, down payment, and reserves. Check the rates page for current ranges.
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