See the difference below Comparison of tax-return qualifying income versus 24-month bank-statement qualifying income and resulting maximum purchase price. Conventional Loan 1040 Tax-return AGI $82,000 Monthly Income $6,833 Maximum DTI 43% → Maximum purchase price $496,375 Non-QM Loan 12 months bank statements deposits $160,000 Monthly Income (after 15% expense factor): $11,333 ($13,333 × 0.85) Maximum DTI 50% → Maximum purchase price $843,750 Sample scenario above assumes a 20-percent down payment, 6.50% interest rate. Your qualifying income may vary based on other factors..
12-Month Bank Statement Loan We average 12 months of your business or personal deposits and apply an industry expense factor to calculate qualifying income. No tax returns necessary. W2 employee okay. Ideal for: consultants, freelancers, 1099 contractors, retail shop & restaurant owners, salaried employees with bonus View Bank Statement Loan Details
24-Month Bank Statement Loan Slightly better rates than using 12-months. The same exact process (no tax returns) but using 24 months and limited to only self-employed applicants. Ideal for: borrowers who have 2 or more years in the same industry and want the best rates and pricing available. View Bank Statement Loan Options
P&L Only Loan A 1 or 2-year profit and loss statement by a tax professional takes the place of tax returns. We use this as your business income. Ideal for: Business owners whose bookkeeping is organized although their deposit history is inconsistent Learn more about P&L mortgages
1099 Only Loan We use your gross income on 1099 statements after an industry expense ratio. Quicker underwriting than using bank statements. Ideal for: real estate agents, insurance brokers, and commissioned sales reps Explore 1099 Loan Requirements
Asset Depletion or Asset Qualifier Use qualifying account balances from your 401(k), IRA, brokerage, or savings as personal income. No 1040 returns needed. Ideal for: high net worth individuals, those who recently sold their business, and retirees. Check Asset-based loan details
DSCR Loan (Investment Property) For rental properties only (homes, condo, 2-4 units, and 5-10 residential or mixed-use). No personal income is allowed. The property's rent is used to qualify Ideal for: investors with LLC's and STR or Long-term rental portfolios See DSCR requirements