ServicesBank Statement Loans
Bank Statement Loans in Elgin
Self-employed income rarely looks as strong on a tax return as it does in your bank account. A bank statement loan lets a lender qualify you on actual deposits rather than taxable income. We review your statements, show how the income figure is built and put the terms in writing before you commit.
A Home Loan Built Around How You Get Paid
Conventional underwriting reads income from the bottom line of your Schedule C or business return. That line is after depreciation, mileage, equipment write-offs and every other deduction your accountant found. Good tax planning can leave you with a figure too low to qualify, even when the business brings in steady money every month.
With this non-QM program, your tax return stays out of the income calculation. Underwriting totals the deposits on 12 or 24 months of personal or business statements, removes transfers and one-time items, reduces business deposits by an expense factor and divides the result by the number of months. What comes out is your monthly qualifying income.
That flexibility has a price. Pricing typically sits above what a comparable conventional borrower would be offered, more cash is needed up front, and lenders want a bigger cushion of reserves left in the bank after closing. We lay those figures out next to each other so you can judge whether the program earns its cost, or whether one of our other loan options suits you better.
What We Handle on a Bank Statement Loan
- 01
Statement period selection
We look at whether 12 or 24 months gives you the stronger average. A strong recent year argues for 12 months. A seasonal or uneven business often does better on 24.
- 02
Deposit analysis
We go line by line through your deposits and flag transfers between your own accounts, loan proceeds and refunds, since underwriting excludes them. You see the income figure before underwriting does.
- 03
Expense factor review
Business statements are reduced by an expense ratio, either a fixed figure set by the loan program or one documented by your CPA or tax preparer. We explain which method helps you and what paperwork it needs.
- 04
Large deposit sourcing
Any deposit well outside your normal pattern needs an explanation and a paper trail, such as an invoice or a contract. We tell you early which ones will be questioned so you can gather support before submission.
- 05
Written loan estimate
You get the rate, points, lender fees, third-party costs and cash to close itemized in writing. If something changes during underwriting, we explain the reason and send revised figures before closing.
Questions about Bank Statement Loans?
Call(512) 601-0828Signs a Bank Statement Loan May Fit You
Your write-offs sink your income
Your business is healthy, but after deductions the taxable income on your return is too low for the payment you want.
You were denied for income alone
Your credit and down payment were fine, yet a lender said your documented income did not support the loan.
You are 1099 or commission-paid
Contractors, real estate agents and gig workers often have strong deposits but no W-2 to show.
Your business recently grew
Last year's return reflects a smaller operation. Twelve months of recent statements can capture income your taxes have not caught up with yet.
You keep clean, separate accounts
Steady deposits, few overdrafts and business money kept apart from personal spending make this program much easier to qualify for.
How the Process Runs
- 1
First conversation
A loan officer asks how your business earns money, how long it has operated and what you plan to buy or refinance. We tell you honestly if a conventional or FHA loan would serve you better.
- 2
Statement review
You provide 12 or 24 months of complete statements, every page included. We calculate qualifying income and point out any deposits, NSF charges or gaps that underwriting will ask about.
- 3
Pre-approval and written terms
Once the income works, we issue a pre-approval and a written estimate of rate and costs. You shop with a real number and know what closing will take.
- 4
Underwriting and closing
We package your file with a CPA letter or business license confirming self-employment and move it into underwriting. As conditions come up, we clear them and keep you posted by phone, then set the closing date with the title company. You sign with figures that match what you were shown.
What Moves Your Rate and Costs
Lenders price bank statement loans on risk, and several parts of your file push that price up or down. We list each factor in writing so you can see what is driving your rate and what you could change to improve it.
- Credit score
- Score tiers carry more weight here than on many conventional loans. Raising your score a little before you apply can lower your rate.
- Down payment and loan-to-value
- A larger down payment reduces the lender's exposure and usually the rate. With only a small amount down, fewer programs will be open to you.
- Cash reserves
- Lenders expect several months of payments to remain in your accounts after closing. Deeper reserves can earn better pricing.
- Statement period and expense method
- Averaging 24 months instead of 12, or using a CPA-documented expense ratio, can change your qualifying income and which programs you can use.
- Property type and use
- A house you will live in is priced more favorably than a vacation property or a rental. Condo projects may also have to pass their own lender review.
Bank Statement Loan Questions
Should I use personal or business statements?
It depends on how your money moves. Personal statements usually count deposits at full value but require clean separation from business funds. Business statements get an expense factor applied, so we run the numbers both ways and show you which produces the stronger income figure.
What kind of track record does my business need?
Two full years working for yourself is the usual benchmark. You document it with a letter from your CPA or tax preparer, or with a business license. Some programs will take a shorter history if you spent the earlier years doing the same kind of work on someone else's payroll. We sort out which rule applies to you during the first call.
Will overdrafts hurt my application?
They can. Underwriters count NSF and overdraft charges, and several in the past year may disqualify you or require an explanation. If you have a few, tell us early so we can see how a given program treats them.
Can I refinance later into a conventional loan?
Yes, and many borrowers plan for it. Once your tax returns show enough income, a conventional refinance may lower your rate. We explain any prepayment terms in writing so you know what that move would cost.
Do you lend outside Elgin?
Yes. We work with self-employed borrowers in Manor, Hutto, Taylor, Bastrop and the surrounding area, by phone and video or at our office.
See What Your Deposits Qualify For
Have your recent statements handy and we will walk through the income calculation with you. You will know where you stand and what the loan costs, in writing, before anything is final.