Bank Statement Loans

    Alternative income verification for self-employed borrowers

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    What is a Bank Statement Loan?

    A bank statement loan is a mortgage program that uses your bank statements to verify income instead of traditional documentation like W-2s, tax returns, or pay stubs. This loan type is ideal for self-employed individuals, business owners, and entrepreneurs whose tax returns don't reflect their true earning capacity.

    Lenders review 12-24 months of personal and/or business bank statements to calculate your average monthly income, providing a more accurate picture of your cash flow and ability to repay the loan.

    Key Benefits

    No tax returns required
    Perfect for self-employed and business owners
    Income based on bank deposits, not tax write-offs
    More accurate reflection of actual earnings
    Available for primary residences, second homes, and investment properties
    Flexible underwriting guidelines
    Higher loan amounts possible based on true income
    12 or 24-month bank statement options

    Requirements

    Credit Score:Typically 680+ minimum
    Down Payment:10% to 20%
    Bank Statements:12 or 24 months (personal or business)
    Self-Employment:Typically 2+ years in business
    Debt-to-Income:Up to 50%

    Who Should Consider This?

    • • Self-employed professionals
    • • Business owners with substantial write-offs
    • • Freelancers and contractors
    • • Real estate investors
    • • Those with variable income streams
    • • Entrepreneurs growing their businesses
    • • Anyone whose tax returns don't show full income

    Important to Know

    Income Calculation: Lenders typically use 50-100% of your average monthly deposits, depending on whether you use personal or business bank statements and your specific situation.

    Interest Rates: Bank statement loans generally have slightly higher interest rates than traditional mortgages due to the alternative documentation method.

    Personal vs. Business Statements: You can use personal bank statements, business bank statements, or a combination of both. Business statements often allow for higher income calculations.

    Seasoning Requirements: Lenders will look for consistent deposits over the statement period and may exclude irregular or one-time large deposits.