Why history matters
The lender must determine whether income is stable and likely to continue. A business that recently opened provides less operating history, so prior work, training, current earnings and business obligations become especially important.
Changing from employee to owner can also change how income and expenses are documented.
A shorter history may be considered
Fannie Mae guidance may allow consideration with at least twelve months of current self-employment shown on the most recent returns when the borrower also has a prior history at the same or greater income level in the same field or a similar occupation.
That is a guideline framework, not a promise of approval. Program, lender and complete-file requirements still apply.
What strengthens the review
Useful records may include complete filed returns, year-to-date financials, business registration, contracts or other evidence requested to establish the business and relevant history.
Stable earnings, manageable business debt and a clear connection between prior experience and current work can help the lender evaluate continuity.
Review the timeline early
Do not wait until after signing a purchase contract to learn whether enough history exists. Ask for a review of exact start dates, filing history, ownership and prior occupation.
If one program does not fit, another may have different requirements, but alternatives can involve different costs and documentation.