12/24 Month Bank Statement

A Bank Statement loan is a home loan program designed for self-employed and business owners. For qualification purposes, the lender uses the deposits made into the business owner’s account as the source of income for qualification purposes, instead of using tax returns.

The primary difference between a Bank Statement loan and a traditional loan program lies in how income is verified. Bank Statement loans use your bank statements to verify income, while traditional loans use tax returns and pay stubs.

At least 24 months old to qualify for a Bank Statement loan.

If your ordinary business income is deposited into a personal account, you can use personal bank statements. Keep in mind, that this may potentially complicate the approval process if you share this account with another person, such as a spouse who has a job. If you are a 1099 wage earner and deposit your earnings into a personal account, we recommend using our 1099 income program.

Yes. If you qualify for a Bank Statement loan, you may be asked to provide a letter from a licensed tax preparer. For a Bank Statement loan, we do not review tax returns, so we rely on third parties, such as a licensed tax professional, to verify certain aspects of your business.

Here are some examples of things that are commonly requested: 

• – Verification of the business’s expense ratio (%)
• – Verification of the length of time the business has been in operation
• – Verification of the percentage of ownership of the business

No. The letter can be from any licensed tax preparer, accountant, or CPA. The letter must be on their letterhead, signed and dated. We must be able to verify the Preparer’s Tax Identification Number (PTIN) or CPA license number.

YES. The letter provided is based on third-party information provided by a licensed tax professional and is not expected to directly match the information on the tax returns. Unlike a traditional home loan program, in a Bank Statement loan program, the lender does NOT pull a tax transcript of the applicant’s personal or business returns from the IRS.

You can, but it would be much easier to use our 1099 income program. Bank Statement loans are designed for true business owners. So an independent contractor earning 1099 wages is not technically self-employed. If the employer pays the applicant in 1099 wages, then the only time the applicant is considered self-employed is by the IRS when they file tax returns, and neither of these two programs use tax returns.
If applicants receive 1099 wages, a 1099 income program is designed more for that type of income and may end up giving them more income and even more buying power than they would with a Bank Statement loan. The two programs are remarkably similar in terms of minimum down payment, minimum credit scores, etc.

Yes, you can still qualify for a Bank Statement loan if you own 50% of a business. However, if your business partner does not qualify for the same home loan, your qualifying income would be reduced by their percentage. For instance, if you own 50% of the business, you can only use 50% of the income from the bank statement income analysis for qualification purposes.

Yes, it can. We will calculate the business owner’s income using bank statements, and the spouse’s income will be calculated using their W2s, pay stubs, and employment verification from their employer.

No. An IRS Form 4506-C authorizes us to obtain a transcript of your tax returns, and signing one is not required for a Bank Statement loan.

No. Co-signers and applicants who do not occupy the new home are not allowed on a Bank Statement loan program.

YES, as long as the bankruptcy, foreclosure, or short sale was completed at least 12 months ago or longer. Depending on the length of time after the certificate of title date, it may affect the minimum down payment on a home.

No. Cryptocurrency deposits cannot be used to qualify for a Bank Statement loan. Only US bank accounts can be used in the income calculation.