It’s Friday in Texas. The lights are on, the band is warming up, and somewhere a 20-year-old athlete just signed an NIL deal worth more than their parents’ first house.
Naturally, the next question comes up at the dinner table. Can we use NIL income for a mortgage?
Here’s the short answer. Sometimes, yes. But it’s harder than the headlines make it sound.
Most lenders treat NIL money like self-employment income. That means they usually want a track record, often two years on your tax returns. They also need confidence the income will keep coming. For many college athletes, that’s a tough combination. Eligibility runs out. Contracts end. Players transfer.
The good news? There are several plays that can still get an athlete into a home. Let’s go to the film room.
The Pregame Show: How NIL Money Works in 2026
NIL stands for name, image, and likeness. Since 2021, college athletes have been allowed to earn money from endorsements, sponsorships, appearances, and social media.
Then the game changed again. In June 2025, a federal judge approved the House v. NCAA settlement. Starting July 1, 2025, schools could pay athletes directly through revenue sharing. The cap was $20.5 million per school for 2025-26 and is estimated at about $21.3 million for 2026-27. It grows each year.
Texas moved first. In June 2025, Governor Abbott signed HB 126, which allows Texas colleges to pay athletes directly for their NIL, according to [LINK: Texas Public Radio → https://www.tpr.org/sports/2025-06-07/texas-law-clears-way-for-colleges-to-pay-players-ahead-of-national-settlement]. The law also lets athletes 17 and older sign NIL deals.
So today, a college athlete may earn money from two directions:
From the school, through revenue-sharing agreements.
From outside companies, like a local car dealer, a restaurant, or a brand on social media. Third-party deals of $600 or more must be reported to a clearinghouse called NIL Go.
That’s real money. In our [LINK: guide to Texas college town home prices → https://texasmortgageplan.com/texas-college-town-home-prices-parents-guide/], we looked at national headlines tying NIL to college-town housing. But having income and qualifying with it are two different things.
Read the Defense: How Lenders Look at NIL Income
Every good offense studies the defense first. Here’s what an underwriter is looking for when you try to use NIL income for a mortgage.
It’s Usually Treated Like Self-Employment Income
Most NIL athletes aren’t employees. They’re paid as independent contractors, and the income is often reported on a 1099.
To a lender, that looks a lot like running a small business. So NIL income usually goes through the same review as other self-employed borrowers. Our guide to [LINK: self-employed mortgages in Texas → https://texasmortgageplan.com/self-employed-mortgage-texas/] covers that process. And our article on [LINK: how lenders calculate self-employed income → https://texasmortgageplan.com/how-lenders-calculate-self-employed-income/] shows how the numbers are figured.
The Two-Year Rule
Lenders generally want to see two years of self-employment income on your tax returns. Some programs allow one year in limited situations. Our article on [LINK: how many years of tax returns lenders need → https://texasmortgageplan.com/tax-returns-self-employed-mortgage/] explains the exceptions.
That’s the first hurdle. A freshman who signed a deal in August has no tax history yet. Even a big contract may not count until it shows up on a return.
The Continuance Question
This is the big one. A lender must believe your income is likely to continue. Many lenders look for income that can reasonably continue for about three years.
That’s hard to show in college sports. Think about everything that can change in a season:
Eligibility runs out.
A revenue-sharing contract ends or isn’t renewed.
An injury takes a player off the field.
A coaching change shakes up the roster.
A player enters the transfer portal.
A junior with a one-year contract may have strong income today. But an underwriter may not be able to count on it three years from now.
Write-Offs Cut Both Ways
Athletes often have real business expenses. Agent fees, training, travel, and equipment can all be deducted.
Those deductions lower your tax bill. They also lower the income a lender can use. Our article on [LINK: tax write-offs vs. mortgage qualification → https://texasmortgageplan.com/tax-write-offs-vs-mortgage-qualification/] explains the trade-off. If buying a home is in the plan, talk with your tax preparer and lender before filing.
The Transfer Portal Problem
Here’s a scenario we think about with every athlete. You buy a home near campus in the spring. Over the winter, you enter the transfer portal and land at a school 300 miles away.
Now what?
You could sell, but a short hold can mean losing money after closing costs. You could rent it out, but that brings landlord duties and possible loan rules about occupancy.
That’s why the location matters as much as the price. Before buying, ask a simple question. If I left tomorrow, would this home still make sense as a rental? Our guide to buying a house near campus walks through how parents and students can structure that decision.
5 Plays That Can Work
If using NIL income for a mortgage on its own isn’t realistic yet, don’t punt. There are other ways to move the ball.
Play 1: Bring In a Co-Borrower
For many athletes, this is the strongest play. A parent joins the loan as a co-borrower, and their income helps qualify. The athlete can still own and live in the home, start building credit, and build equity.
The trade-off is that the parent is on the hook for the loan too. Make sure everyone understands that before signing.
Play 2: Let Assets Do the Work
Some athletes have saved a large share of their NIL earnings. Those savings can help in several ways.
A bigger down payment lowers the loan amount and the payment. Strong savings also count as reserves, which lenders like to see. Our article on [LINK: how much cash reserves you need → https://texasmortgageplan.com/how-much-cash-reserves-mortgage/] explains why.
Some loan programs can even qualify you based on assets instead of income. Our guide to a mortgage using assets as income shows how that works.
Play 3: Look at a Non-QM Loan
Non-QM loans don’t follow standard agency rules. Some, like bank statement loans, look at deposits instead of tax returns.
These loans can offer more flexibility. They often come with higher rates and larger down payments. They can make sense when the income is real but doesn’t fit the usual box.
Play 4: Build the Track Record First
Sometimes the best play is patience. An athlete with steady NIL income in freshman and sophomore years may have two years of tax returns by junior year.
Meanwhile, use that time to build credit, save for a down payment, and keep every contract and 1099 organized. When it’s time to apply, you’ll be ready.
Play 5: Buy With Cash, But Keep a Cushion
A few athletes have enough NIL money to buy a modest home outright. That avoids the qualification question entirely.
Just don’t empty the bank account to do it. Keep enough cash for taxes, repairs, and the unexpected. If you need cash later, a home bought with cash can sometimes be refinanced, though that comes with its own rules.
Coaching Points for Athletes and Parents
Whichever play you run, these coaching points apply.
Buy below what you qualify for. NIL income can change quickly. A payment that feels easy this year should still feel manageable if the income drops.
Set aside money for taxes. Independent contractor income usually doesn’t have taxes withheld. Many athletes need to make estimated tax payments during the year.
Keep the paperwork. Save every contract, 1099, and bank statement. Lenders will want to see them.
Build credit early. Many young buyers have short credit histories. A credit card used lightly and paid in full each month is a good start.
Talk to a lender before you shop. A planning conversation can show which play fits before you fall in love with a house.
The Final Whistle
Most college athletes won’t play professionally. That’s not bad news. It’s the reason a smart plan matters.
Used well, NIL money can be a launchpad for long-term wealth. A home bought carefully, at the right price, in the right place, can keep building equity long after the last snap.
Most lenders are focused on getting you approved. We’re focused on something more important: helping you make the right decision. For a 20-year-old with a big NIL deal, the right decision may be buying now, waiting a year, or bringing a parent onto the team.
NEXT STEP
NIL income is usually reviewed like self-employment income. Our free Self-Employed Income Calculator shows how a lender may look at 1099 earnings and business expenses, so you can see where you stand before you apply.
Try the Self-Employed Income Calculator
Income doesn’t fit the usual box? Explore our self-employed and non-QM loan options.
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Self-Employed Mortgage in Texas
How Many Years of Tax Returns Do Lenders Need?
FREQUENTLY ASKED QUESTIONS
NIL Income Basics
Q: Can you use NIL income for a mortgage?
A: Sometimes. Most lenders treat NIL money like self-employment income. They usually want a history on your tax returns and confidence that the income will continue. Many athletes qualify more easily with a co-borrower or strong assets.
Q: Is NIL income considered self-employment income?
A: Usually, yes. Most NIL athletes are paid as independent contractors, and the income is often reported on a 1099. Lenders typically review it the same way they review other self-employed borrowers.
Q: Can Texas colleges pay athletes directly?
A: Yes. Texas HB 126, signed in June 2025, allows Texas colleges to pay athletes directly for their name, image, and likeness. The House v. NCAA settlement also allows revenue sharing nationally.
Qualifying as a Young Athlete
Q: How many years of NIL income do I need to qualify?
A: Lenders generally want two years of self-employment income on your tax returns. Some programs allow one year in limited cases. A new deal may not count until it appears on a return.
Q: Does a revenue-sharing contract count as income?
A: It can be considered. A lender will look closely at the contract’s length and whether the income is likely to continue. A short contract may be hard to count on its own.
Q: Can my parents co-sign on a home loan for me?
A: Often, yes. Many loan programs allow a parent to join as a co-borrower. Their income can help you qualify, but they are also responsible for the loan.
Planning the Purchase
Q: What happens if I transfer schools after buying a home?
A: You could sell the home or rent it out. Selling soon after buying can mean losing money to closing costs. Renting it out may bring landlord duties and loan occupancy rules. Plan for this before you buy.
Q: Should I pay cash for a home with my NIL money?
A: It can work, but keep a cash cushion. Set money aside for taxes, repairs, and emergencies. Draining your savings to buy a home can leave you exposed if your income changes.
Texas Mortgage Plan – 50+ years of combined mortgage experience, serving homeowners and homebuyers across Flower Mound and the DFW Metroplex. Elizabeth Rose, NMLS 252686, CDLP® Certified Divorce Lending Professional | Shea Patton, Mortgage Advisor, NMLS #251397, Licensed Realtor. Texas Mortgage Plan is a d/b/a of Legacy Mortgage, NMLS #1759275 | Equal Housing Lender
