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in Dublin, CA
Self-employed borrowers in Dublin face unique challenges when qualifying for mortgages. Traditional lenders require tax returns that often understate actual income due to business deductions.
Bank statement loans and profit & loss statement loans offer two different paths to prove your income. Both are non-QM options designed specifically for business owners and independent contractors.
Understanding which documentation method works best depends on your business structure, record-keeping practices, and how you manage cash flow through your accounts.
Bank statement loans use 12 to 24 months of personal or business bank statements to calculate your qualifying income. Lenders analyze deposits to determine average monthly income.
This option works well if you have consistent deposits and maintain separate business accounts. No CPA-prepared documents are required, making it faster for borrowers who don't maintain formal P&L statements.
Lenders typically use 50% to 100% of deposits as qualifying income, depending on your business type. The exact percentage varies based on whether you have business expenses flowing through the account.
Profit & loss statement loans require a CPA-prepared P&L covering at least 12 months of business activity. This document provides a detailed breakdown of revenue and expenses.
This approach suits borrowers who maintain formal accounting records and work with a CPA regularly. The P&L offers a comprehensive view of business performance beyond simple bank deposits.
Lenders evaluate net income after expenses, giving a clearer picture of actual profitability. Many Dublin business owners prefer this method when their bank statements don't reflect true earning capacity.
The main difference lies in documentation complexity and preparation time. Bank statement loans are faster since you simply provide existing bank records, while P&L loans require professional accounting preparation.
Income calculation methods differ significantly. Bank statement loans use deposit percentages, while P&L loans use actual net income figures that account for all business expenses.
Cost considerations vary between the two options. Bank statement loans may have slightly higher rates due to simpler documentation, while P&L loans require CPA fees but potentially better terms. Rates vary by borrower profile and market conditions.
Credit and down payment requirements are similar for both programs. Dublin borrowers typically need credit scores of 620 or higher and at least 10-20% down payment for either option.
Choose bank statement loans if you have consistent deposits, don't work with a CPA regularly, or need to close quickly. This works well for contractors, consultants, and gig economy workers with straightforward finances.
Choose P&L statement loans if you maintain detailed books, already work with a CPA, or have complex business structures. Real estate investors and established business owners often benefit from this approach.
Consider your documentation timeline when deciding. Bank statement loans can move faster since you're providing existing records, while P&L loans require time for your CPA to prepare current statements.
Your SRK Capital loan officer can review your specific situation and recommend the best path. Many Dublin self-employed borrowers qualify for both options and choose based on convenience and rate differences.
Yes, you can use personal or business bank statements, or a combination of both. Lenders will analyze deposits across all provided accounts to calculate qualifying income.
Most lenders require a P&L covering the most recent 12-24 months, prepared by a licensed CPA. The statement should be dated within 90 days of your loan application.
Rates vary by borrower profile and market conditions. P&L loans may offer slightly better terms due to more detailed documentation, but individual circumstances matter most.
Most lenders prefer at least two years of self-employment in the same field. However, some programs accept one year with strong income documentation and reserves.
Yes, if your initial documentation approach isn't working well, your lender can often switch to the other method. This flexibility helps find the best fit for your situation.