Program

1099 Loans for Independent Contractors

Independent Contractors

Independent contractors earn on 1099s, so that’s what we underwrite. Qualify using 1099 income with a fixed expense ratio — no tax returns or complicated write-off calculations.

1099 IncomeNo Tax Returns

At a glance

Loan amounts
To $3M
Max LTV
85%
Min FICO
From 600
History
Self-employed 2+ years
1099 income is calculated using a fixed 10% expense ratio, with YTD documentation supporting continued receipt of income.

What Is a 1099 Loan?

A 1099 loan is a Non-QM mortgage that qualifies self-employed borrowers and independent contractors using IRS Form 1099 income instead of tax returns. Income is calculated using a fixed expense ratio, providing a straightforward alternative documentation path.

Who Are 1099 Loans For?

Real-estate agents, loan officers, and insurance producers
Drivers, couriers, and platform-based gig workers
Contract nurses, IT consultants, and project-based professionals
Self-employed borrowers and independent contractors with an established history in their line of work
“You get paid on a 1099, so we qualify you on a 1099. No returns, no write-off math.”
How to pitch it to your borrower

How Does a 1099 Loan Work?

What the file needs — and how we get to a number.

011099 forms

IRS Form 1099 is used to document qualifying income, with YTD documentation supporting continued receipt of income.

02Income calculation

1099 income is calculated using a fixed 10% expense ratio, with YTD documentation supporting continued receipt of income.

03Continuity

YTD documentation supports the continued receipt of income from the 1099 source.

04Property

Primary and second homes (Sunny) and investment properties (Breezy).

1099 Loan Requirements

Borrower self-employed for at least 2 years
Fixed 10% expense ratio with YTD documentation supporting continued receipt of income
Business established and in existence for at least 2 years
FICO from 600, depending on program; loan amounts up to $3M
IRS Form 1099 used to document qualifying income

Requirements follow the current Sky TPO matrices and guidelines; see the matrix for each suite below.

Sky TPO 1099 Loan Programs

Each suite sets the occupancy, loan amounts, and matrix — pick the one that fits the property.

Sunny

Primary & Second Homes · Full/Alt-DocAlt doc 1099 — primary & second homes.
Alternative Documentation — Bank Statement, P&L, 1099, WVOE & Asset UtilizationMatrixGuidelines
ITIN — Full & Alternative DocumentationMatrixGuidelines

Breezy

Investment · DSCR & Full/Alt DocAlt doc 1099 for investment properties.
Alternative Documentation — Bank Statement, P&L, 1099, WVOE & Asset UtilizationMatrixGuidelines

Real-World 1099 Scenarios

Scenario 01

Top-producing agent

Top-producing agent with established 1099 income from her brokerage. No tax returns required; 80% LTV on a $1.1M purchase.
Scenario 02

Travel nurse

Self-employed consultant with an established two-year history receiving 1099 income. Uses 1099 documentation instead of tax returns to qualify for a primary residence.

Frequently Asked Questions About 1099 Loans

What is a 1099 loan?

A mortgage that qualifies independent-contractor income from 1099 forms instead of tax returns.

Can 1099 and W-2 income be combined?

Yes — each is documented its own way on the same file.

How long do I need to be self-employed?

Standard 1099 programs require at least two years of self-employment and a business that has been in existence for at least two years. Requirements may vary by program.

Are tax returns ever needed?

Traditional tax returns are generally not required for 1099 qualification, subject to applicable Sky TPO program guidelines.

Have a 1099 scenario?

Price it in Sky Port in minutes or send it to the Scenario Desk.