Mortgage Financing for Self-Employed Contractors in San Antonio, TX

Scan the options below, pick the one that matches how your income is documented — or isn't — and follow that link. If you're still weighing programs, the orientation below will help you place yourself.

What to know before you choose a loan type

San Antonio's construction market stays active year-round, but local lenders writing conventional loans will underwrite you the same way they'd underwrite a salaried buyer — and that's where most contractors hit a wall. Your Schedule C shows taxable income after write-offs, not gross revenue. If you own a small framing crew or run a solo electrical contracting business, that gap can be wide enough to disqualify you even when cash flow is genuinely strong.

The good news is that the non-QM market has matured. Bank statement mortgages, alt-doc mortgages, and 1099-only programs now cover most self-employed scenarios, and San Antonio has enough non-QM lenders active in Bexar County to create real competition on pricing.

Key thresholds by loan type

Program	Min. FICO	Down Payment	Income Doc
Conventional (Fannie/Freddie)	620	3–5%	2 yrs tax returns + YTD P&L
FHA	580 (3.5% down)	3.5–10%	2 yrs tax returns
Bank statement (non-QM)	620–640	10–20%	12–24 months bank statements
1099-only	640	10–20%	1–2 yrs 1099s, no returns
DSCR (investment property)	640	20–25%	Rental income only

Rate premium: Non-QM bank statement loans run roughly 1–3 percentage points above conventional pricing. On a $350,000 purchase in San Antonio's median price range, that spread is real money — factor it into your payoff timeline.

Expense ratio haircut: Non-QM lenders apply a standard expense factor before calculating qualifying income. For construction businesses, expect 40–50% of gross deposits to be deducted as assumed expenses. A sole proprietor depositing $12,000/month may qualify on $6,000–$7,200 of that figure. Freelancers in adjacent trades face the same math — the home loan qualification strategies for self-employed workers are structurally identical even across different 1099 income types.

Reserves: Plan to show 6–12 months of mortgage payments in liquid reserves. Non-QM underwriters treat reserves as the buffer that offsets income documentation risk. Keeping business and personal accounts separate — and clean — makes this easier to demonstrate.

Self-employment history: Both conventional and FHA programs want two full years of self-employment documented via tax returns. Non-QM lenders are more flexible, but most still want 12–24 months of bank statements showing consistent deposit activity in the same business line.

What trips people up: Contractors who file aggressively — maxing write-offs to minimize taxes — often discover their tax return income is too low to qualify for any program, conventional or otherwise. The fix isn't stopping write-offs; it's understanding that non-QM lenders will count bank deposits instead. Timing matters too: if you're planning to buy within 18 months, talk to a mortgage broker before your next tax filing, not after. Strategies like income-averaging across 24 months can also help if one year was unusually low.

San Antonio-specific note: Bexar County sits well below the high-cost conforming loan limit, so most purchases qualify under standard conforming ceilings. Jumbo non-QM is available from several portfolio lenders active in the San Antonio metro, but expect tighter reserve requirements and a 720+ FICO for the best terms.

Contractors in similar situations across Texas — and in markets like Amarillo where construction trades are also a major employment base — run into the same documentation issues. The loan programs are the same; the local lender mix differs.

Tax planning has a direct effect on how much income a lender will count. Quarterly estimated payments and expense-tracking discipline keep your bank statement deposits cleaner and your qualifying income higher — payment planning built around irregular 1099 income is worth getting right before you apply.