Question 1

How do lenders calculate income from bank statements?

Accepted Answer

They average monthly deposits over 12 or 24 months, then apply an expense ratio. Business accounts typically use 50% of deposits as income.

Question 2

Can I use both personal and business bank statements?

Accepted Answer

Yes, but most lenders require you to choose one or the other for income calculation. Personal accounts typically qualify you for more.

Question 3

What if my deposits vary significantly month to month?

Accepted Answer

Lenders average all months together. Seasonal businesses work fine as long as the annual average supports your loan amount.

Question 4

Do bank statement loans require tax returns at all?

Accepted Answer

Some lenders want returns for asset verification only, not income. Others skip tax documents entirely and rely solely on statements.

Question 5

How much higher are rates compared to conventional loans?

Accepted Answer

Expect 1-2% higher than conforming rates. Rates vary by borrower profile and market conditions based on your complete risk picture.

Bank Statement Loans in Albany: Financing for Self-Employed Homebuyers