You earned more last year than you ever did on staff, and a lender just told you most of it doesn't count. That's the frustration behind so many searches for a mortgage for travel nurses. Between a low taxable hourly rate, tax-free stipends, a few weeks off between assignments and pay stubs from three different agencies, your file doesn't look like a typical W-2 borrower's, even though you technically are one.
Locum tenens physicians, CRNAs, therapists and other contract clinicians run into a similar wall from the 1099 side. Let's walk through how lenders see each piece and what options exist.
Key takeaways
- Many travel nurses are W-2 employees paid a taxable base rate plus non-taxable stipends, and lenders treat those two parts very differently.
- Some lenders may consider stipends in certain situations, but many won't, so the taxable base often drives qualifying.
- Gaps between contracts are common and not automatically disqualifying; continuity in your profession matters most.
- Locum physicians and other 1099 clinicians may qualify through 1099, bank statement or P&L programs.
- Your tax home, multiple state filings and agency changes all need clean documentation. Talk to your CPA about the tax side.
How travel nurse pay looks to a lender
A typical travel nurse package has a few parts:
- Taxable hourly wage. Often lower than you'd expect, because the agency shifts pay into stipends.
- Housing stipend and meals and incidentals (M&IE). Generally non-taxable when you maintain a qualifying tax home and duplicate living expenses. Your CPA can tell you whether you qualify.
- Overtime, bonuses and completion pay. Variable and dependent on the assignment.
Your blended weekly pay might be excellent, but the W-2 at the end of the year only shows the taxable portion. And that's the first number most underwriters look at.
Do lenders count stipends?
This is the big question, and the honest answer is: it varies. Stipends are reimbursements for duplicate expenses, not wages, so many lenders exclude them. Some lenders may consider them if there's a documented history of receiving them and evidence they're likely to continue, though even then they may not count the full amount. If you maintain a tax home and pay a mortgage or rent there, that obligation still counts against you, which can make the math even tighter.
The practical takeaway: plan on qualifying from the taxable portion unless a specific lender confirms otherwise, and treat stipend income as upside rather than the foundation.
Gaps between contracts
Travel nurses commonly take a few weeks off between assignments. Lenders don't expect a clinician on 13-week contracts to work every day of the year.
What they want to see is continuity in your profession. A stable history in nursing, with reasonable breaks between contracts, usually reads very differently from someone changing careers. Things that help:
- A clear work history listing each assignment, agency, facility, location and dates.
- A signed contract for your current or next assignment, which shows income is expected to continue.
- A short letter explaining any longer gap, such as time off for family, a move, or certification.
- Two years of tax returns and W-2s from every agency you worked through.
Multiple agencies isn't a red flag by itself. The profession is the constant, and that's what a good underwriter focuses on.
Locum tenens physicians, CRNAs and 1099 clinicians
Many locum physicians, nurse anesthetists, physical and occupational therapists and other specialists work as independent contractors. Instead of a W-2 and stipends, you receive 1099s from staffing firms or directly from facilities, and you may pay your own travel, licensing, malpractice tail coverage and CME.
That makes you self-employed in a lender's eyes. Conventional lenders typically average your net Schedule C income, which is reduced by all of those legitimate expenses. If you also run an S-corp or PLLC for contract work, the lender may need business returns and K-1s too.
Some physicians use a separate path entirely. If you own a practice, our guide on mortgages for medical and dental practice owners covers that scenario.
Program options for contract clinicians
| Program | How income is figured | May fit when... | Trade-offs |
|---|---|---|---|
| Conventional / agency | Net income from tax returns, usually two years averaged | Your returns show strong net income | Write-offs reduce income; agency changes need explaining |
| 1099 income loan | Gross 1099 earnings less a lender-applied expense factor | Your contract pay is mostly on 1099s | Pricing typically higher than conventional; history requirements vary |
| Bank statement loan | Qualifying deposits over 12 or 24 months | Income comes from several facilities or firms | Deposits must be traceable; larger down payment than many conventional loans |
| P&L loan | A P&L from an eligible preparer | You operate through an entity with clean books | Preparer requirements vary; supporting statements may be requested |
Some 1099 programs consider a shorter history when your earnings are steady and you've been in the same field. If you recently switched from employed to contract work, read about a 1099 mortgage with one year of history.
Contract work shouldn't count against you. Let us look at how different lenders would read your W-2s, stipends or 1099s. See if you qualify →
Illustrative example: a locum hospitalist
Consider a hypothetical locum hospitalist paid on 1099s by two staffing firms.
- Total 1099 earnings for the most recent year: $340,000
- Schedule C net after travel, licensing in several states, malpractice-related costs, CME and other expenses: $255,000
A conventional lender would typically start from the $255,000 net figure and may average it with the prior year.
A 1099 program applying a hypothetical 10% expense factor to gross would calculate:
- $340,000 x 0.90 = $306,000
- $306,000 / 12 = $25,500 monthly qualifying income
At these income levels, the loan amount may cross into jumbo territory depending on the market. Our guide to a jumbo loan for self-employed borrowers covers what changes at that point, including reserves and documentation.
Illustrative example — not an offer or a guarantee of qualifying income. Actual calculations, expense factors and eligibility vary by lender, program and your full profile.
Tax home, multiple states and where you'll live
A few issues come up again and again for traveling clinicians.
Your tax home
If you maintain a tax home to receive non-taxable stipends, you're likely paying for housing there. A lender will count that rent or mortgage in your debt-to-income ratio. If you're buying a home that will become your tax home, discuss with your CPA how that affects your stipends going forward. We don't give tax advice, but we'll make sure the mortgage side lines up with whatever plan you and your CPA choose.
Occupancy
Primary residence financing generally requires that you intend to live in the home as your principal residence. If you'll be away on assignment for much of the year, be upfront with your lender about your plans. Depending on the situation, the purchase may be better structured as a second home or investment property, and each has different requirements.
Multiple state returns
Working in several states can mean several state tax returns. Lenders may ask for all of them. Keep a folder with each state's return and any W-2s or 1099s tied to it.
Licenses
Having active licenses, including compact licenses for nurses, helps show you can keep working. Keep copies handy.
Mixed W-2 and 1099 households
Some clinicians switch between W-2 travel contracts and 1099 locum work, or have a spouse with a traditional salary. Blending those incomes is doable, but each type has its own documentation rules, and a 1099 side that shows a loss could reduce your overall qualifying income. Our guide to a W2 and 1099 income mortgage walks through how to decide what to include.
Document checklist
Gather the following before applying:
- Two years of personal tax returns, including all state returns.
- All W-2s and 1099s from every agency or staffing firm.
- Recent pay stubs from your current assignment, showing taxable pay and stipends separately.
- Current and upcoming contracts, signed.
- A work history timeline listing assignments, facilities and dates.
- Copies of active professional licenses.
- Bank statements for the accounts where your pay is deposited.
- A letter explaining any extended gaps.
Honest trade-offs
- Non-QM pricing is typically higher than conventional, because these loans are priced for different risk.
- Down payment and reserve expectations are often larger than many conventional loans.
- Stipends may add little or nothing to qualifying income with many lenders.
- Not everyone qualifies, especially with a very short contract history or long unexplained gaps.
The upside: clinicians are among the most employable people in the economy, and many lenders recognize that. A broker who knows which lenders understand travel and locum income can make a real difference.
Frequently asked questions
Q: Do mortgage lenders count travel nurse housing stipends?
A: Many don't, because stipends are reimbursements rather than wages. Some lenders may consider them with a documented history and evidence they'll continue, but rules vary widely. It's safest to plan on qualifying from your taxable pay.
Q: How do lenders handle gaps between travel nursing contracts?
A: Short gaps between assignments are normal and usually not a problem if you've stayed in the profession. Longer gaps may need a letter of explanation. Having a signed upcoming contract helps show continuity.
Q: Can a locum tenens physician get a mortgage on 1099 income?
A: Yes, it's possible. Conventional lenders typically use net Schedule C income, while 1099, bank statement and P&L programs may calculate income differently. The right choice depends on your expenses, history and documentation.
Q: Does working through several agencies hurt my application?
A: Not necessarily. Lenders generally focus on whether you've stayed in the same line of work. Expect to provide W-2s or 1099s from each agency and a clear timeline.
Q: Can I buy a home in a state where I'm not currently working?
A: Often yes, but occupancy matters. If it's your primary residence, you'll need to intend to live there as your principal home. If not, a second home or investment loan may be the right structure.
Let's find the lender who gets contract work
You go where you're needed and do work most people can't. Your mortgage shouldn't be derailed because your pay arrives in a format a standard checklist doesn't expect.
Send us your contracts, your pay structure and what you're hoping to buy. We'll show you how different programs would read your income, what each requires and the trade-offs, before you commit to anything.
See if you qualify → — no credit pull to check your options. Prefer to talk? Call or text 713-366-4668.
This article is general education, not tax, legal, or financial advice, and not a commitment to lend. Loan programs, guidelines, and availability vary by lender and state and change without notice. Non-QM loans are subject to credit approval, income and asset verification, and appraisal. Talk with your CPA about tax questions. Small Business Mortgages is a marketing brand of Matador Lending, NMLS #2072896. Equal Housing Opportunity.