Mortgages for attorneys and law-firm partners in California.
Lenders generally treat an equity partner in a law firm as self-employed, and read the firm’s K-1 with your personal tax returns, usually over about two years. Making partner changes how you are paid: a salary and a W-2 give way to draws, a K-1 and a capital contribution. Sam Batayneh works with attorneys and law-firm partners across California, and explains how lenders read partnership income.
What makes partnership income different.
An associate is an employee. A partner is an owner, and lenders read owners differently.
Partner draws and distributions
Partners are often paid in monthly draws, with larger distributions during or after the year. Lenders look at the year as a whole, not at a single month.
K-1 income
A partner’s share of the firm’s income is reported on a K-1. Lenders generally read it with your personal tax returns, usually over about two years.
Capital contributions
Many firms ask partners to pay capital into the firm, often with a loan. That loan is a debt lenders count, and the capital itself is usually not money you can use to buy.
How lenders generally look at partnership income.
Each lender sets its own rules. These are the questions most of them ask.
Employee or owner
Lenders first ask whether you are paid on a W-2 or a K-1. A partner paid on a W-2 is generally read like an employee, and an equity partner as self-employed.
A history of the income
About two years of K-1 income is a common starting point. With a shorter history, some lenders look to a letter from the firm and to your earlier pay.
What was actually paid
Many lenders compare the income on the K-1 with the money the firm actually paid out to you, and may count the lower of the two.
Debts tied to the firm
A capital loan reduces what is left each month. Lenders count its payment like any other debt.
Bonuses
For associates and counsel, a year-end bonus is often counted only after a history of receiving it, commonly about two years.
What to have on hand.
Your firm’s finance office and your CPA will know most of this list. Sam will say exactly what is needed.
- Tax returns. Usually two years of personal returns, with all schedules.
- K-1s. The last two years, from the firm.
- From the firm. A letter that states your position, how you are paid and any capital loan, if the lender asks for one.
- Pay. Recent pay stubs and W-2s, if you are on the payroll.
- Accounts. Recent statements for bank and investment accounts.
Programs to ask Sam about.
Partnership income shown on tax returns and K-1s is usually documented for a conventional or a jumbo loan. The loan amount decides which of the two it is.
Program names are OriginPoint’s. Which one fits depends on your own file, and naming a program here is not a promise that a loan will be approved.
Plain answers.
How do lenders count law-firm partner income?
I just made partner. Can I still get a home loan?
How does a capital contribution loan affect my application?
Can I use my year-end distribution for the down payment?
General education only. Each lender sets its own rules, and they change. Nothing here is a promise that a loan will be approved or of any terms. This is not tax, legal or investment advice: for those questions, ask your own CPA, attorney or business manager.
Limits where you’re buying.
Each page has the county’s 2026 limit and what is different there.
Just made partner?
Tell Sam how the firm pays you. Sam will explain how lenders are likely to read it.