This is a very specifics-driven situation, so treat what follows as the framework rather than a yes or no. Picture a common version of it: someone who moved from 1099 or self-employed work into a W-2 job paying, say, 85 to 100 thousand, while still earning around 40 thousand from ongoing Schedule C work on the side. Both incomes can potentially count, and the documentation rules have real precision to them: - The five-year, one-return provision. On a conventional loan, Fannie Mae's automated underwriting can allow just one year of personal and business tax returns when every self-employed business has existed for at least five years and you have held at least 25% ownership for the last five consecutive years. The test hinges on the business's age and your ownership stake, and a strong recent year can work in your favor. - The short-history provision. Separately, a borrower with less than a two-year self-employment history can sometimes qualify with one year of returns, when the most recent return covers a full 12 months and the file documents prior receipt of similar income in the same field. Freddie Mac has comparable provisions. No guarantee either way. A significant year-over-year drop in self-employment income raises questions about whether that income is stable and likely to continue, and the underwriter weighs the trend against the full picture: how long each source has existed, the direction of the numbers, and how the returns are structured. Files like this need a direct, one-on-one read of the actual returns, because small details flip the answer. The free Roadmap conversation, about 20 minutes where we run your real numbers, is where we would read your returns and tell you which income we can use and what you would qualify for.