Investor whose income is all 1099
Can I buy a rental property if all my income is 1099?
A 1099 income mortgage exists precisely because 1099 income does not fit neatly into conventional underwriting — but for a pure rental purchase, a DSCR loan can skip the whole documentation question.
- DSCR rental loan The loan qualifies on the subject property’s rent, so how the borrower’s own income is reported — 1099, W-2, or otherwise — never enters the calculation.
- 1099 income mortgage That product still qualifies the borrower on an adjusted version of their own 1099 income, which is more documentation than a pure rental purchase needs when DSCR is available.
Lenders in the directory
No lender here publishes a rule for this
This is an underwriting judgment, not a published threshold. None of the 37 lenders in the directory states a policy on it, so there is no honest way to build a shortlist — and a list computed only from which products a lender writes would tell you nothing you could act on.
What matters here is how the file is presented rather than which lender receives it. The sections below cover that. When you are ready to approach lenders, the directory shows what each one does publish, with the date it was verified.
Why 1099 income is awkward for conventional underwriting
1099 income has no employer-side withholding or net-pay figure the way a W-2 does, so lenders qualifying a borrower on 1099 income typically apply an expense factor or other adjustment to arrive at a usable number, and often average it over a lookback period. That process exists specifically because 1099 income does not map cleanly onto standard income underwriting.
What a 1099 income mortgage does about it
This is a real non-QM product built to document 1099 earnings directly rather than forcing them through a conventional two-year averaging model. It is a genuine option — but it still qualifies the borrower on personal income, with all the documentation and adjustment that requires.
Why DSCR sidesteps the question entirely for a rental purchase
A DSCR loan does not use any income source — 1099, W-2, or otherwise — to qualify the loan. It compares the subject property’s rent to its own payment. For an investor buying a rental specifically, that is generally more direct than adjusting and averaging 1099 income through a borrower-income product.
When the 1099 income product is still the right tool
An all-1099 borrower buying a primary residence, where DSCR does not apply, is exactly the case a 1099 income mortgage or another borrower-income non-QM product is built for.
What to have ready
- The subject property’s lease or a market-rent estimate
- Reserves and credit documentation, since DSCR still reviews both
- Your 1099s on hand anyway, in case a lender wants context
Questions
Do I need to show my 1099s for a DSCR loan?
Is a 1099 income mortgage the same as DSCR?
What if I want to buy a primary residence, not a rental?
Terms used on this page
- Debt Service Coverage Ratio (DSCR) — DSCR is a property’s gross monthly rent divided by its total monthly mortgage payment. A DSCR of 1.00 means the rent exactly covers the payment; 1.25 means rent exceeds the payment by 25%.
- Non-QM Loan — A non-QM loan is a mortgage that does not meet the Qualified Mortgage standard, usually because it verifies income by some route other than tax returns. It is a documentation category, not a credit-quality one.
- No-Income-Verification Mortgage — A no-income-verification mortgage qualifies a borrower without tax returns, W-2s or pay stubs. On investment property this generally means a DSCR loan, which qualifies on the property’s rent instead.