3.5% down, qualified on a profit and loss statement
FHA P&L Only
After your accountant writes off the equipment, the vehicle, the home office and the depreciation, the income on your tax return looks nothing like the cash the business actually produces. Standard FHA underwriting reads that number and hands back a debt-to-income ratio that fails. This program reads a two-year profit and loss statement instead. Everything else — the 3.5% down payment, the county loan limits, the mortgage insurance — is ordinary FHA.
Program requirements
- 3.5% down on a purchase, up to 80% LTV on a cash-out refinance
- A two-year profit and loss statement replaces the tax returns — borrower-prepared, no CPA
- 640 minimum credit score
- 46% housing DTI, 56% total DTI
- FHA county loan limits apply: $541,287 in standard counties, up to $1,249,125 in high-cost counties for 2026
- A slightly higher initial rate that reverts to the market rate after six months of on-time payments
- Primary residence only, and it cannot be combined with down payment assistance or first-time buyer programs
Guidelines vary by program and by borrower profile, and are subject to change. Contact us for current terms.
*Rates shown are for illustrative purposes only, are not a commitment to lend, and cannot be guaranteed in regards to your individual financial position by Mr. Mortgage Capital Corporation. Actual rates depend on credit profile, loan-to-value, occupancy, property type and other factors, and are subject to change without notice. For the most accurate and personalized results, we encourage you to seek advice from one of our qualified financial professionals.
How the borrower-prepared P&L works
You submit a 24-month profit and loss statement: revenue, expenses and net income through today. The lender qualifies you on the net income from that statement, in place of the tax returns standard FHA underwriting would pull.
It can come out of accounting software (QuickBooks, Wave, Xero), out of a bookkeeper’s records, or off a spreadsheet you keep yourself. No licensed accountant has to sign it. That is the difference between this and a CPA P&L loan, and it is also the $500 to $2,000 that preparing one usually costs.
The statement still has to reflect what the business actually did. Misstating income on a mortgage application is fraud, and it is the one part of this with no flexibility in it at all.
Two years self-employed in the same trade
Twenty-four months running the same business in the same line of work. Sole proprietorships, LLCs, S-corps and partnerships all qualify. Under two years generally does not. There is a narrow exception for borrowers with prior W-2 income in the exact same field plus one year of self-employment, and those are reviewed case by case.
A 640 credit score, not 580
The floor here sits above standard FHA’s 580. The lender raises it because documenting income by an alternative route carries more risk than verifying it in full. Most self-employed borrowers who pay their obligations on time clear 640 without trouble.
46% housing, 56% total
The housing ratio covers principal, interest, taxes, insurance, mortgage insurance and HOA dues. The total ratio adds everything else: car loans, credit cards, student loans, and any business debt sitting on your personal credit. Both are more forgiving than the 43% a conventional loan works to.
The house you live in
Primary residence only. Investment properties, vacation homes and second homes are out. If you are self-employed and buying to rent, the product to ask about is a DSCR loan, which qualifies on the property’s rental cash flow rather than on you.
FHA P&L Only
If your tax return is the only thing standing between you and an FHA loan at 3.5% down, this is the program to ask about. Bring us the last two years of the business and we will tell you where the numbers land.