ServicesBank Statement Loans
Bank Statement Loans in Leander
Your tax returns show what is left after write-offs, not what your business actually brings in. A bank statement loan lets you qualify on 12 or 24 months of deposits instead. We will walk you through which statements to use and what that choice changes.
A home loan that reads your income the way you earn it
A typical lender wants two years of tax returns and qualifies you on the net figure. If you are a contractor, a consultant, an agent or you run a shop, that figure is usually well below what you actually earn, because your deductions are working as intended. A bank statement loan sets the returns aside and looks at the deposits flowing into your accounts.
These fall under non-QM lending, which means they are not bound by the standard rules conventional loans follow. That flexibility has a price. The rate is usually higher than a conventional loan, and you will likely need more money down. If your returns already support the payment, a conventional loan may be the cheaper path, and we will say so plainly.
We bring 11 years in the mortgage industry to this work, and we have held our NMLS license for 10 years. A good share of that time has been spent laying out options like this one in everyday language, so you can choose the version that matches how your books really look.
The options we lay out for you
Personal or business statements
You can qualify on personal accounts, business accounts, or sometimes both. Personal statements usually count deposits more fully. Business statements need an expense adjustment, which we explain next.
Expense factor or CPA letter
With business statements, the lender assumes a share of deposits goes to expenses and counts the rest as income. If your real expenses are lower, a letter from your CPA or tax preparer stating your expense ratio can raise your qualifying income.
12 months or 24 months
A 12-month look works well if business has grown recently. A 24-month look can smooth out a slow year and sometimes opens better terms. We run both so you can see the difference.
Down payment and reserves review
These loans often expect more money down and a few months of payments saved after closing. We go over what you have on hand before you start shopping, not after.
Deposit clean-up
Transfers between your own accounts, loan proceeds and one-time sales generally do not count as income. We sort these out with you early so the underwriter sees a clear picture.
Signs a bank statement loan may be the right fit
Your returns undersell you
Deductions for your truck, tools and workspace shrink your taxable income to a number that does not match your life. Your deposits paint a fuller picture.
Another lender said no
You were told your income was too low, even though every bill gets paid on time. That usually means only your tax returns were reviewed.
About two years on your own
Most programs look for roughly two years of self-employment in the same field. If you are newer than that, reach out anyway and we will see what fits.
Your income rises and falls
Seasonal or project-based work can look uneven month to month. Averaging a year or two of deposits smooths out the busy stretches and the quiet ones.
You want an investment property
Self-employed investors often take this route for a rental. Some investor versions include a prepayment penalty, and we bring that up before you commit.
From the first conversation to the closing table
- 1
Talk through pre-qualification
We ask how long your business has been running, what your credit looks like and what you want to buy or refinance. It is a short conversation by phone, by video or at our office.
- 2
Pull your statements
You download 12 or 24 months of statements with no pages missing. We will also need something showing you are self-employed, like a business license or a letter from your CPA.
- 3
We work out your qualifying income
We add up the deposits that count, apply the expense method that suits your file and show you the income a lender is likely to use. You can compare the options side by side.
- 4
Loan application and underwriting
When you are ready, we submit the loan application. Underwriters tend to ask about large deposits, so we point those out in advance and keep you updated as questions arrive.
- 5
Closing day
Once the appraisal and final approval are done, you sign at the title company. We go over the closing numbers with you ahead of time so the figures you see there match what you expected.
What shapes your rate and closing costs
Lenders price each bank statement loan on its own, so two self-employed borrowers with similar deposits can be quoted different numbers. The question underneath is how much risk the file carries. Below are the pieces that move pricing the most, and we walk through each one with you when we put your rate quotes together.
- Credit score
- Stronger scores usually earn better pricing. Paying down a card balance or two before you apply can sometimes nudge the rate in your favor.
- How much you put down
- A larger down payment means the lender has less at stake. Going above the program minimum often lowers the rate.
- Which statements you use
- Personal statements, or a full 24 months of history, can price better than a 12-month look at business deposits alone.
- What you are buying and why
- A place you will live in full time tends to get the best pricing. Investment properties and vacation places cost more, and a condo or a duplex can bring separate pricing adjustments.
- Savings left after closing
- Lenders like seeing several monthly payments set aside once the loan closes. Healthy reserves strengthen the file and can improve your terms.
Bank statement loan questions
Something not covered here? (512) 456-9507
Will I have to hand over my tax returns?
In most cases, not to prove income. Your statements do that job instead. A lender may still have you sign a form so it can confirm you filed, but the net income on your returns is not the figure used to qualify you.
How much should I plan to put down?
Expect a larger down payment than a conventional loan asks for. Many programs begin near 10 percent, and the better terms often show up at 20 percent or more. On our first conversation we look at your credit and savings and give you a number you can plan around.
Can I use one of these to refinance?
Yes. Self-employed borrowers refinance with them to chase a lower rate or to pull cash from their equity. The lender reviews your deposits the same way it would on a purchase.
My business and personal spending run through the same account. Is that a problem?
Plenty of self-employed people bank that way, and it can usually still work. The job is separating true income from transfers, refunds and reimbursements. Send us the statements and we will sort through the deposits together.
Could I switch to a conventional loan someday?
Often, yes. When your tax returns start showing enough income, refinancing into a conventional loan may bring the rate down. We are glad to run those numbers with you when the time comes.
Find out what your business income can buy
A ballpark of what lands in your accounts each month and a sense of your credit is all we need to start. From there we handle the math with you on the phone, for self-employed borrowers in Leander, Cedar Park, Georgetown and nearby.