Question 1

Can I qualify for either loan with less than two years of self-employment?

Accepted Answer

Many lenders prefer two years of self-employment history, but some accept one year with strong income and reserves. Your specific qualifications depend on your complete borrower profile and the lender's requirements.

Question 2

Are interest rates higher for these loans compared to conventional mortgages?

Accepted Answer

These non-QM loans typically carry slightly higher rates than conventional financing due to alternative documentation. Rates vary by borrower profile and market conditions, including credit score, down payment, and income stability.

Question 3

Do I need to provide tax returns with either option?

Accepted Answer

Requirements vary by lender. Some 1099 loan programs request tax returns to verify reported income. Bank statement loans often require fewer tax documents, focusing instead on deposit patterns in your accounts.

Question 4

Can I use both 1099 income and bank statements together?

Accepted Answer

Some lenders offer hybrid approaches, but typically you'll choose one primary verification method. Your mortgage broker can help determine which documentation path presents your income most favorably for underwriting.

Question 5

What down payment do I need for these loans in Orinda?

Accepted Answer

Down payment requirements typically range from 10% to 20% for non-QM loans, though some programs accept less with compensating factors. Higher down payments often secure better terms and rates.

1099 Loans vs Bank Statement Loans in Orinda: Which Self-Employed Option Fits Your Needs?