What is the Bank Statement Program?
The bank statement program allows you to have your cake and eat it too. Hang on to all of the deductions that essentially make up your income and still live in the home you deserve.
Until now, the only reason you have not been able to qualify for a conventional mortgage is because the banking and lending industry wants to control the way you borrow.
If you have ever felt as though the system was designed to force you to file taxes a certain way and pay an incredibly large portion of your earnings in order to qualify for a standard mortgage… you were right! In a very real sense, it is set up to work against the entrepreneur.
But thanks to the introduction of these products back into the market place in 2016, self employed borrowers and investors finally have an alternative.
We have gone against convention and looked at every borrowers scenario individually, in order to get our clients to qualify and we will do the same for you.
Bank statement loans are popular with the following types of borrowers:
- Business owners
- Freelance employees
- Contract workers
- Independent contractors
- Sole proprietors
- Gig economy workers
How do bank statement loans work?
- We collect the last 12 months of your bank statements and calculate your income based off of deposits. Not every deposit is qualifying, But we have years of experience in presenting your deposits in such a way, as to maximize your allowable income. Once the income has been established and the credit has been analyzed we can write you a pre-approval on the same day! If you are in need of a refinance, we can typically prepare a file for submission within 48 hours and have an approval back within 48 hours of disclosures being acknowledged.
What are the Differences Between a Bank Statement Loan and a Traditional Home Loan?
Bank Statement Loans
- These loans are built for people who do not have W2 jobs such as business owners, realtors, consultants, restaurant owners, and gig economy workers (with a valid business license).
- These loans allow the borrowers to use bank statements as the form of proof that they are able to pay back the loan amount.
Advantages of a Bank Statement Loan
In summary, these are the advantages of a bank statement loan:
- The lender does not need to look at your tax returns or tax transcripts.
- Your income statements are made up of regular monthly income deposits.
- The lender can look at 12 or 24-month bank statements.
- If you own a business, you can show 24 months of business statements and a P&L statement for the same period. A P&L statement (profit and loss statement) is prepared by a Certified Public Accountant. Not all business owners will be required to present one.
- You can get a bank statement home loan for as little as 10 percent down.
- You can do a cash-out refinance loan of up to 85 percent of the value of your property.
- You can borrow up to $5 million.
- Typically, bank statement lenders will accept a debt to income ratio of a maximum 55 percent.
- You have the option of a fixed-rate or adjustable mortgage.
- You may have the option of interest-only