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Bank statement mortgages give self-employed buyers a simpler path to homeownership. Pre-qualify now or call 888-573-2640.
What is a bank statement mortgage and how does it work?
If you're self-employed, bank statement mortgages create a path to homeownership by verifying income differently.
This loan option skips traditional income documentation requirements and offers flexibility where conventional mortgages don't work well.
Definition and purpose of bank statement mortgage loans for self employed
A bank statement mortgage is a type of non-qualified mortgage (non-QM) loan that helps borrowers who can't provide traditional income documentation like W-2s, pay stubs, or tax returns.
This loan type lets you qualify based on cash flow qualification based on cash flow shown through bank deposits instead of tax-reported income.
Clear Rate Mortgage offers these specialized loans to entrepreneurs, business owners, and self-employed professionals whose tax returns don't show their actual earning capacity.
How lenders calculate income from deposits
Lenders review 12-24 months of deposit history to evaluate bank statement mortgages and determine income stability.
They calculate qualified income by adding all eligible deposits during this period and dividing by the number of months.
How do bank statement mortgages work in practice
The actual process might interest you. You'll need to submit 12-24 months of statements to Clear Rate Mortgage. They determine your qualifying income by reviewing your deposit history and using appropriate expense factors.
Bank statement mortgages need manual underwriting, unlike conventional loans with automated systems.
Key requirements and eligibility criteria
Getting approved for bank statement mortgages means meeting specific criteria designed for self-employed borrowers.
Lenders need these requirements to assess risk while giving more options to borrowers who don't have standard income documents.
Required months of bank statements
You'll need to show 12-24 months of consecutive bank statements so lenders can see your income patterns. Self-employed people with less than two years of business experience can still qualify with 12 months of statements if they have worked in the same field before.
Pros, cons, and deciding if it's right for you
Bank statement mortgages have their pros and cons. You need to assess if they match your financial needs.
Benefits of flexibility and no tax returns
Bank statement mortgages give entrepreneurs a way to get approved when their tax returns don’t show the whole picture. These loans check your income through deposits instead of traditional paperwork.
When to think about a self employed bank statement mortgage
A bank statement mortgage makes sense if your tax returns show less income than you really earn. Business owners with deductions or those with seasonal or commission income may find these loans helpful.
Clear Rate Mortgage: Your Partner in Bank Statement Mortgages
At Clear Rate Mortgage, we know the challenges self-employed buyers face. Our bank statement mortgages give you a straightforward way to move forward, with guidance built on transparency, fast communication, and a client-first approach.
We review your unique situation carefully and walk you through each step so you feel confident, not overwhelmed. If you’re ready to explore your options, call us at 888-573-2640 or pre-qualify now!
FAQs
1. Are bank statement mortgages only for business owners?
No, they can also work for freelancers, independent contractors, and other self-employed professionals. The focus is on showing steady income through deposits rather than tax paperwork.
2. Can bank statement mortgages be used for different property types?
Yes, they may apply to primary homes, second homes, or even investment properties. The exact options depend on your financial profile and goals.
3. Do bank statement mortgages take personal expenses into account?
Personal spending is less important than showing consistent deposits that prove stable cash flow. Lenders mainly care about your ability to handle ongoing payments.
4. How do bank statement mortgages compare with alternative income loans?
They are one of several flexible loan options for self-employed borrowers. The main difference is that they use deposits as the key way to confirm income.
5. What makes bank statement mortgages a good choice for entrepreneurs?
They let entrepreneurs qualify without being limited by tax strategies that lower reported income. This creates a fairer way to show real earning potential.
