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Self-employed mortgage programs are popular for investment property financing. Self-employed investors often have complex tax situations that make traditional documentation difficult, and these programs offer more flexibility than conventional investment property loans.

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Why Investors Choose These Loans

  • Tax returns often show losses due to depreciation and write-offs
  • Conventional investment property guidelines are restrictive
  • Higher loan amounts available than conventional limits
  • Can finance multiple properties without hitting conventional caps

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Typical Investment Property Requirements

Investment properties have stricter requirements than primary residences due to higher default risk.

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Using Rental Income to Qualify

Some lenders allow rental income to supplement your qualifying income: Subject property rental income — Projected rent from the property you’re purchasing, typically supported by an appraisal with rental analysis or existing lease. Other rental income — Income from investment properties you already own, documented through leases and bank statement deposits. Lenders may use 75% of gross rent to account for vacancy and expenses.

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Property Types

Most lenders financing these loans will fund:
  • Single-family rentals
  • 2-4 unit properties
  • Condos (including non-warrantable)
  • Short-term rentals (Airbnb/VRBO) with some lenders

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Rate and Pricing Impact

Investment properties carry pricing adjustments: A single-family investment purchase might be 0.5% higher than an equivalent primary residence loan. A 4-unit cash-out refinance could be 1%+ higher.

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Multiple Investment Properties

If you own multiple financed properties, lenders typically require additional reserves for each—often 2-6 months PITIA per property beyond the subject property. This can add up quickly for portfolio investors.