Bank Statement Programs for Self-Employed

You can get a mortgage if you are self-employed. However, it does require some extra planning and going outside of conventional financing. Self Employed Borrowers are normally required to provide two years of tax returns for income qualifying. Often, these don’t accurately reflect the actual take-home pay of a self-employed person.

There are now multiple programs available for the Self-employed borrowers needing alternative income documentation.

These programs use your bank statements, not your tax returns, to calculate your income. The income part of underwriting is actually relatively straightforward. You gather 12-24 month’s of bank statements from one single account, either personal or business. Then, you calculate all the deposits (credits) over that time period. This is averaged into a monthly “income”. This would normally be the income that is used for qualifying purposes.

Where do these loans sometimes run into issues? First off, reviewing 12-24 months of bank statements could reveal odd transactions, withdrawals or deposits, that might not show up in a normal, conventional loan underwriting process. Anything that is considered a red-flag would need to be verified. Second, there may be transfers between the account you are using for qualifying and another account you own. Underwriting may want to verify that you aren’t just moving money back and forth between accounts; i.e, they’ll want to verify this is actually income. Finally, underwriting will want to document that your deposits are not credits from loans that don’t show up on your credit report.

Some of the highlights of the programs include:

  • Up to 90% Loan To Value on personal and business bank returns and 50% Debt to Income with Fico scores as low as 600.
  • No tax returns required
  • Qualify with 12 month’s of personal bank statements
  • Qualify with 12 month’s of business bank statements
  • Loans up to $3 million
  • Credit scores down to 600
  • Rates starting in the low 5’s
  • Up to 90% LTV on Personal and Business bank statement programs with no Mortgage Insurance
  • Owner-occupied, 2nd homes and investment properties
  • 2 years seasoning for foreclosure, short sale, bankruptcy or deed-in-lieu
  • Non-warrantable condos considered
  • Jumbo loans down to 600 score
  • 5/1 ARM or 30-year fixed
  • No pre-payment penalty for owner-occupied homes and 2nd homes
  • Seller concessions up to to 6% allowed on purchase transactions (2% for investment)
  • 2 year self-employed required

These Bank Statement programs have become valuable assets for Self-Employed borrowers. Please contact us at or call us at 303-444-5251 for more information.