What is a Bank Statement Loan?
A bank statement mortgage loan is for someone who is self-employed. This loan allows self-employed borrowers to apply for a home loan without showing net income on taxes, pay stubs, etc. Someone who might use this type of loan typically has a lot of deductions and write offs, making the net income too low to be used for a conventional loan.
Advantages of a Bank Statement Loan
- You are not required to show tax returns or transcripts
- Income statements are made up of monthly income deposits
- Option for fixed-rate or adjustable mortgage
- As little as 10% down
- Lender can look at bank statements from 12-24 months back
- LTV (loan-to-value ratio) up to 90%
- Loan amounts up to $3 million
- 55% DTI (debt-to-income ratio) okay with 680 FICO (credit score)