Home Loans
Bank Statement Mortgage
Home financing built for self-employed borrowers u2014 qualify with your bank statements instead of W-2s.
Overview
What Is a Bank Statement Mortgage?
A bank statement mortgage is a non-QM (non-qualified mortgage) product designed for self-employed borrowers whose tax returns may not reflect their true earning power. Instead of relying on W-2s and tax returns, lenders analyze 12 to 24 months of personal or business bank statements to calculate qualifying income. This approach captures the real cash flow of entrepreneurs, freelancers, and business owners who legitimately reduce their taxable income through deductions.
Key Benefits
Why Choose This Program?
- ✓ No W-2 or tax returns required
- ✓ 12 or 24-month bank statement options
- ✓ Available for primary, secondary, and investment homes
- ✓ Gift funds allowed for down payment
- ✓ Competitive rates for self-employed professionals
- ✓ Interest-only options available
Requirements
What You’ll Need
- ✓ Minimum credit score: 620
- ✓ 12-24 months of bank statements
- ✓ Down payment typically 10-20%
- ✓ Business license or CPA letter verifying self-employment
- ✓ Sufficient cash reserves
- ✓ Property appraisal required
Who Should Choose This Loan?
Is a Bank Statement Mortgage Right for You?
- ✓ Self-employed business owners and entrepreneurs
- ✓ Freelancers and independent contractors
- ✓ Borrowers with significant tax write-offs reducing reported income
- ✓ Real estate investors buying a primary residence
Frequently Asked Questions
Bank Statement Mortgage FAQ
How is income calculated with bank statements?
Lenders typically average your monthly deposits over 12 or 24 months, then apply an expense ratio (often 50%) to account for business expenses. The result is your qualifying monthly income.
What is the difference between personal and business bank statements?
With personal statements, the lender uses your actual deposits. With business statements, they apply an expense factor since business deposits include revenue before expenses.
Are bank statement mortgage rates higher?
Rates are typically 0.5-1% higher than conventional loans, reflecting the alternative qualification method. However, the ability to qualify at all often outweighs the slightly higher rate for self-employed borrowers.
Can I use a bank statement loan for a refinance?
Yes, bank statement mortgages can be used for both purchases and refinances, including cash-out refinances to tap into your equity.
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Ready for a Bank Statement Mortgage?
Get a personalized rate quote and see how much you qualify for.