Home Equity Line of Credit · Self-employed
HELOC for Self-Employed and 1099 Borrowers
If your tax returns understate what you actually earn, a HELOC underwritten from your deposit accounts is a very different experience than one underwritten from two years of returns.
Overview
Your deposits, read directly.
Self-employed borrowers, contractors and commission earners run into the same wall on every loan: the income a tax return shows after deductions is not the income that actually supports a payment. The usual fix is a bank statement program, where twelve or twenty-four months of statements get averaged by an underwriter. This HELOC takes a faster route to the same idea. You link your deposit accounts through Plaid during the application and the system reads the deposits itself, which is why an approval can come back in minutes rather than after a document chase. The practical consequence is that what you connect is what counts. If your revenue lands in a business account you do not link, it does not exist as far as the read is concerned. If you take draws into a personal account, link both so the transfer and the source are visible. Borrowers who connect one account out of three routinely come back with a smaller line than they qualify for and assume that is the answer. It is not; it is the input.
Colorado · California · Georgia · Texas · NMLS 1352284 · HELOC overview · Bank statement loans
Who it is for
Who this fits
- Business owners whose returns show little after deductions
- 1099 contractors and commission earners with uneven monthly income
- Realtors, consultants and trades with strong deposits and messy paperwork
- Anyone who has been declined on a bank HELOC for documentation, not capacity
- Owners who need funds fast for a business opportunity or a property
- Not a fit if your deposits genuinely do not support the payment
Highlights
What changes when deposits do the talking
No document chase
No paystubs, no employer verification, no waiting on your accountant. You connect accounts and the system reads them.
Connect all of them
Business and personal. The read covers what it can see, so an unlinked account is invisible income and a smaller line.
Minutes, not weeks
Approval can come back within minutes of linking, with funding in 5 to 10 days on the standard path.
Investment property works
If your equity is in a rental rather than your home, this product can still work. See HELOC on an investment property.
A cleaner option than a cash-out
Pulling cash out of a low-rate first mortgage reprices the whole balance. A line only prices the new money.
The rest of my Non-QM shelf
If a line is not the right structure, bank statement, 1099, P and L only and DSCR programs cover the same borrowers.
Questions
Self-employed HELOC questions
Do I need tax returns for this HELOC?
The application is built around connecting your deposit accounts rather than collecting documents. Verification of income and employment is still part of the process, but the deposit connection is what drives the fast read, which is exactly why it suits borrowers whose returns understate their income.
Which accounts should I connect?
Every deposit account you use: operating accounts, personal checking and savings, and any account where revenue or draws land. Connecting a subset is the most common self-inflicted problem in this process, and it shows up as a credit line smaller than you expected.
Is my banking data safe?
The connection runs through Plaid, the same infrastructure used by most major financial apps. It provides read access to account data for verification. It does not give anyone the ability to move money out of your accounts.
What if my business is newer than two years?
Ask before you assume the answer is no. Program minimums still apply, but a deposit-based read treats a strong recent track record differently than a tax-return-based one does. Send me the situation and I will tell you plainly whether it works.
Self-employed and tired of the paperwork?
Start the application and connect your accounts, or send me the scenario first and I will tell you whether this is the right structure before you apply.
Home equity lines of credit are offered through Citywide Home Mortgage, a Guaranteed Rate company. Credit limits, rates, fees, draw and repayment periods, property types and state availability depend on credit, combined loan-to-value, occupancy and program guidelines and are subject to change; full terms, rates and disclosures are provided in the application. This page is educational and is not an offer or commitment to lend, and is not financial, tax or legal advice. A home equity line of credit is secured by your home; failure to repay may result in loss of the property. All loans are subject to credit approval and property valuation. David Silva, NMLS 1352284 – Licensed in Colorado, California, Georgia and Texas – Equal Housing Lender.