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in Orinda, CA
Self-employed borrowers in Orinda have two strong options for proving income without traditional W-2s. Bank statement loans and profit & loss statement loans both serve entrepreneurs, freelancers, and business owners who need flexible documentation.
Both are non-QM mortgages designed specifically for self-employed professionals. The main difference lies in how you verify your income—through bank deposits or through formal financial statements prepared by a CPA.
Bank statement loans review 12 to 24 months of personal or business bank statements to calculate your qualifying income. Lenders analyze deposits to determine your average monthly income, making this ideal if you have consistent cash flow but significant business write-offs.
This option works well for borrowers who maintain detailed bank records but may not have formal CPA-prepared financials. You'll typically need good credit and a down payment of at least 10-20 percent.
The approval process focuses on deposit patterns rather than tax returns. This helps borrowers whose tax returns show lower income due to legitimate business deductions.
Profit & loss statement loans require a CPA-prepared P&L to document your business income. This formal approach appeals to lenders because certified financial statements provide a clear picture of your earning capacity.
Your CPA must be licensed and the P&L typically covers 12 to 24 months of business operations. This option suits established business owners who already maintain professional accounting records.
Rates vary by borrower profile and market conditions. This loan type may offer better terms than bank statement loans because the CPA verification adds credibility to your income claims.
The documentation requirement separates these two options. Bank statement loans let you qualify using deposits, while P&L loans require formal accounting. If you already work with a CPA, the P&L route may be straightforward.
Bank statement loans offer faster processing since you just provide existing bank records. P&L loans take longer because your CPA must prepare and certify the financial statements.
Cost differs too. Bank statement loans have no CPA fees, but you'll need organized records going back two years. P&L loans require paying your accountant to prepare the statements, but this professional documentation may help you secure better loan terms.
Choose bank statement loans if you want quick processing and already maintain clean banking records. This works well for newer self-employed borrowers or those without established CPA relationships.
Pick P&L statement loans if you already have a CPA preparing your business financials. The professional verification may help you qualify for better terms, especially if your business shows strong profitability.
Consider your business structure too. Sole proprietors often prefer bank statement loans for simplicity. LLC and S-Corp owners frequently choose P&L loans since they already maintain formal accounting for tax purposes.
SRK Capital helps Orinda self-employed borrowers evaluate both options. We'll review your specific situation to determine which documentation method gets you the best terms for your home purchase or refinance.
Switching mid-process can delay approval significantly. Choose your documentation method upfront based on what you have readily available and which presents your income most favorably.
Yes, both bank statement and P&L loans can finance investment properties. Self-employed real estate investors use these options regularly throughout Contra Costa County.
Most lenders require 12 to 24 months of documentation. Longer history strengthens your application by showing consistent income patterns over time.
Rates vary by borrower profile and market conditions. Non-QM loans like these typically carry slightly higher rates than conventional loans, but they offer approval flexibility that conventional loans cannot.
Your CPA must be licensed and in good standing. Some lenders require the CPA to have been preparing your financials for at least one year before loan application.