A Bank Statement Loan is a flexible mortgage option designed for self-employed borrowers, business owners, freelancers, and independent contractors who may not qualify using traditional tax-return income. Instead, qualifying income can be calculated using deposits shown on personal or business bank statements.

This type of loan can be especially useful for borrowers whose tax returns show lower taxable income because of legitimate business deductions. Depending on the program, lenders may review 12 to 24 months of bank statements to determine income and evaluate the borrower’s ability to repay the loan.

Bank Statement Loans may be available for primary residences, second homes, investment properties, purchases, and refinances. Loan options can include fixed-rate and adjustable-rate mortgages, with requirements based on factors such as credit, down payment, reserves, property type, and overall financial profile.

Because Bank Statement Loans are typically Non-QM loans, rates and qualification requirements may differ from conventional mortgages. However, they can provide a valuable financing solution for self-employed borrowers with consistent cash flow who need an alternative way to document their income.

Kal Duwage Mortgage Inc. can help review your financial situation and identify Bank Statement Loan options that may fit your needs.