Loading
in Angels Camp, CA
Both bank statement loans and P&L statement loans let self-employed borrowers in Angels Camp qualify without traditional W-2s. The difference comes down to how you document your income and which method shows your earning power more clearly.
Bank statement loans analyze deposits over 12-24 months. P&L statement loans require CPA-prepared financials. Your choice depends on your business structure and how you manage cash flow.
Bank statement loans use 12 or 24 months of business or personal bank statements to calculate income. Lenders add up deposits and apply an expense ratio—typically 25% to 50%—to determine qualifying income.
This works well for business owners who run most transactions through their bank accounts. You don't need a CPA or formal financial statements. Most programs accept personal bank statements if business and personal funds mix.
P&L statement loans require a CPA-prepared profit and loss statement covering 12-24 months. Some lenders also want a business balance sheet. The CPA must be licensed and cannot be related to you.
This option suits borrowers with established accounting relationships. The P&L shows net income after expenses, which often qualifies you for more than bank statement analysis. Lenders verify the CPA's credentials before approval.
Bank statement loans cost less upfront—no CPA fees required. P&L loans typically offer better rates because the income documentation is more formal and audited by a licensed professional.
Bank statement programs work faster if you already have statements on hand. P&L loans take longer because the CPA needs to prepare and sign off on financials. Income calculation also differs: bank statements use gross deposits minus a standard expense ratio, while P&L shows actual net profit.
Choose bank statement loans if you don't have a CPA relationship or your business runs cash-heavy with strong deposits. This works for contractors, service providers, and small business owners who keep most revenue in the bank.
Pick P&L statement loans if you already work with a CPA and your financials show solid net income. This option fits established businesses with clean books—think rental property owners, consultants, or anyone who writes off significant expenses that reduce taxable income but still show profit.
Yes, but it restarts underwriting. The income calculation and documentation requirements differ completely between the two programs.
Most lenders don't require full tax returns. The CPA-prepared P&L serves as your income documentation.
P&L statement loans typically price better because the income documentation is formal and CPA-verified. Rates vary by borrower profile and market conditions.
No. Lenders use one income calculation method per file. Choose the approach that shows your income most favorably.
Most programs require 12 or 24 months. The 24-month option typically gets better pricing and higher loan amounts.