Loading
in Oakley, CA
Self-employed borrowers in Oakley have two strong mortgage options when traditional documentation won't work. Both 1099 loans and bank statement loans help independent contractors and business owners qualify without W-2s.
These non-QM programs serve the growing number of self-employed professionals in Contra Costa County. The right choice depends on how you receive income and what documentation you can provide.
1099 loans use your annual tax forms to verify income. If you're a contractor who receives 1099 forms from clients, this option lets you qualify based on that documented income.
This program works well for consultants, freelancers, and gig workers with steady 1099 income. You'll typically need one to two years of consistent earnings to qualify.
The process resembles traditional mortgages but accepts 1099 forms instead of W-2s. Lenders review your tax returns and 1099 documentation to calculate qualifying income.
Bank statement loans analyze 12 to 24 months of business or personal bank deposits. This approach works when your bank statements show strong cash flow but your tax returns reflect lower net income.
Many self-employed Oakley borrowers benefit from this flexibility. You avoid the income limitations that business write-offs create on tax returns.
Lenders calculate your income from deposit patterns rather than taxable income. This method often reveals higher qualifying income for business owners who maximize deductions.
The main difference lies in documentation and income calculation. 1099 loans rely on tax forms showing reported income, while bank statement loans use actual deposits to determine earnings.
Bank statement programs typically reveal higher qualifying income for borrowers with significant business deductions. If your tax returns show lower net income due to write-offs, bank statements may show your true earning power.
1099 loans offer a simpler process if you don't take many deductions and your tax returns reflect strong income. Bank statement loans require more documentation but provide flexibility when tax returns don't tell the full story.
Choose a 1099 loan if you receive regular contractor payments and your tax returns show strong net income. This works well when you claim minimal business deductions and your reported income supports your home purchase goals.
Select a bank statement loan if you write off substantial business expenses that reduce your taxable income. This option benefits Oakley business owners whose bank deposits significantly exceed their tax return figures.
Both programs serve self-employed borrowers who don't fit conventional loan requirements. Rates vary by borrower profile and market conditions, so comparing your specific situation helps identify the better option.
You typically choose one documentation method, though some lenders may consider both. The approach that shows your strongest qualifying income usually makes the most sense for your application.
Non-QM loans like these often carry slightly higher rates than conventional options. The rate difference reflects the alternative documentation and flexibility these programs provide for self-employed borrowers.
Most lenders require at least one to two years of self-employment history. Consistent income over this period demonstrates the stability lenders need to approve your mortgage application.
Both programs typically require similar down payments, often 10-20% depending on your full financial profile. Your credit score, income stability, and property type influence the specific requirement.
Bank statement loans average your deposits over 12-24 months, smoothing out fluctuations. Occasional low months won't disqualify you if your overall average supports the loan amount you need.