Bank Statement Loans · Florida
Complex income? Your bank deposits may tell the story your tax returns don’t.
For small business owners and professionals, such as accountants, financial advisors and consultants.
The short answer: If you own a small business or work as a professional, such as an accountant, financial advisor or consultant, your tax returns may not show the income you really earn. Instead of relying on tax returns to calculate income, the lender may review 12 or 24 months of bank statements. For business accounts, lenders typically adjust the deposits for business expenses, and some deposits (such as transfers between your own accounts) are left out. It is a non-QM option, nothing is guaranteed, and the lender may still ask for other documents, including tax-related ones. I’m Darryn Stephen, a Senior Mortgage Advisor in Jupiter, FL, and I can tell you early whether it may fit.
- Florida-licensed
- NMLS #2664300
- Smart Home Loans NMLS #1734077
Who it may fit
- Self-employed buyers and business owners whose write-offs make taxable income look low
- Professionals with complex income, such as accountants, financial advisors and consultants
- 1099 contractors, freelancers and commission earners
- Owners with complicated returns that don’t show their real cash flow
- Gig and seasonal earners with steady deposits
If your bank deposits show the income you really earn, a bank statement program may be worth a look.
How it works
- You share your statements. Usually 12 or 24 months of personal or business bank statements, depending on the program.
- The lender reviews your deposits. For a business account, the lender may apply an expense adjustment.
- Qualifying income is worked out. The average of qualifying deposits, after adjustments, may be used as your monthly income.
- The rest of the loan is reviewed as usual. Credit, assets, the property and the appraisal still matter.
- The lender may verify your business. For example, with a business license or a letter from a CPA or other tax professional.
These are non-QM loans, with different terms from a standard loan. Often a larger down payment is needed, and pricing may differ. How much varies by lender, program and your profile.
What to have ready
- 12 or 24 months of consecutive bank statements, personal or business
- Proof the business exists and how long it has operated, such as a license, registration or a CPA letter, depending on the lender
- Statements for savings, retirement or investment accounts that show funds for the down payment, closing costs and reserves
- A short explanation of any large or unusual deposits. Transfers between your own accounts are usually left out
- A list of your monthly debts and a government-issued ID
- Any other documents the lender asks for, which may include tax-related ones
Keeping business and personal money in separate accounts makes statements much easier to review.
What still applies
- Credit, appraisal and full underwriting. This is not a shortcut. The lender still reviews the whole file.
- Self-employment history. Typically about two years, though some lenders accept one year.
- Down payment and reserves. A meaningful down payment and cash reserves are often required.
- Your taxes are still your responsibility. Please ask your own tax professional about taxes.
Not sure which way of documenting self-employed income fits you? See my overview of self-employed mortgage options.
Where I help: Jupiter, Palm Beach Gardens, Tequesta, Stuart, Hobe Sound, Port St. Lucie, West Palm Beach, and the Tampa / Hillsborough County area, by phone, video or in person.
Questions people ask me
Straight answers. Programs and guidelines change, and everything depends on the lender, the program and the borrower's profile.
Can my bank deposits be used instead of tax returns?
They may be. Instead of relying on tax returns to calculate income, the lender may review typically 12 or 24 months of bank statements. For business accounts, lenders typically adjust the deposits for business expenses, and some deposits, such as transfers between your own accounts, are left out. The lender may still ask for other documents, including tax-related ones. It depends on the lender, the program and your profile, and nothing is guaranteed.
What is a bank statement loan?
It is a type of non-QM mortgage that may use 12 or 24 months of bank deposits to work out your income instead of relying on tax returns. These loans have different terms from a standard loan, and requirements depend on the lender and program.
Does the lender review my tax returns?
Many bank statement programs calculate income from your statements instead of your returns, but the lender may still ask for other documents, including tax-related ones. Details vary by program.
How long do I need to be self-employed?
Typically about two years, though some lenders accept one year. It varies by lender and program.
Who may qualify?
Small business owners and professionals, such as accountants, financial advisors and consultants, may be a fit, along with self-employed buyers and 1099 earners. The lender may also want to verify your business, for example with a license or a CPA letter.
Do I use personal or business bank statements?
Programs may allow either. Which one is used, and how deposits are counted and adjusted for business expenses, depends on the lender and the program.
Will it cost more or need a bigger down payment?
Often a larger down payment is needed, and pricing may differ from a standard loan. It varies by lender, program and your profile, so I compare options with you before you decide.
Tax returns that don’t show your real income? Let’s look at your statements.
Call or text me and tell me how you earn your income. I’ll tell you honestly whether a bank statement loan may fit. No pressure.
Honest answer: if a loan won’t work I’ll tell you. But not without trying.
Smart Home Loans NMLS #1734077 · Darryn Stephen NMLS #2664300 · Equal Housing Opportunity. Not a commitment to lend. Programs, terms and eligibility depend on the lender and the borrower’s profile. This is general information, not legal, immigration, tax or financial advice. Program availability and requirements vary widely by lender.
Let’s talk it through
No pressure, just clear answers about what may fit. Call, text or email me.
Ready to apply? Start at smarthomeloans.net.