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in Clovis, CA
Both 1099 loans and bank statement loans solve the same problem for Clovis self-employed borrowers: proving income without W-2s. The difference is how lenders calculate what you can afford.
1099 loans use your tax returns to measure income. Bank statement loans use cash flow from deposits. The route you pick depends on how you run your business and what shows up where.
1099 loans base approval on income reported to the IRS via 1099 forms. Lenders review your tax returns to see what you actually claimed as earnings. Write-offs reduce your qualifying income.
You need clean tax returns showing steady 1099 income over 12-24 months. Credit minimums typically start at 620. Down payments range from 10% to 20% depending on your income documentation strength.
This works well if you report most of your income and don't take aggressive deductions. Fresno County contractors with straightforward tax filings often qualify faster with 1099 docs than bank statements.
Bank statement loans analyze 12 or 24 months of business or personal bank deposits. Lenders apply a percentage to your average monthly deposits to estimate income. They ignore what you told the IRS.
You avoid the write-off penalty. If you deposited $15k monthly but only claimed $8k after deductions, the bank statement shows the higher number. Credit scores start around 620-640.
Down payments run 10-20% for strong profiles. Clovis business owners with heavy tax deductions but solid cash flow gain thousands in buying power with this approach.
The income calculation splits these programs. 1099 loans count what you reported on taxes. Bank statements count what you deposited. A contractor earning $180k who wrote off $60k qualifies for $120k on a 1099 loan but closer to $180k on bank statements.
Documentation requirements differ too. 1099 loans need organized tax returns with matching 1099 forms. Bank statement loans need clean statements without random deposits flagged as income. Mixing business and personal accounts complicates bank statement approvals.
Rates vary by borrower profile and market conditions. Bank statement loans sometimes carry slightly higher rates due to perceived risk. The gap narrows if your credit exceeds 700 and you put 20% down.
Choose 1099 loans if you file conservative returns and report most income. They're faster to underwrite when your 1099 forms match tax filings cleanly. Fresno area contractors with simple business structures close faster this way.
Pick bank statement loans if you maximize deductions or run expenses through your business. The deposit method captures income your tax return hides. This matters more in Clovis where many self-employed borrowers need every dollar of qualifying power.
Run both scenarios before deciding. A broker can calculate your income under each method using actual documents. The option giving you higher approval amounts usually wins unless rates swing the math.
No. Lenders pick one income calculation method per file. Mixing documentation types creates underwriting conflicts that delay or kill deals.
1099 loans close quicker when your returns are organized and match your 1099 forms. Bank statements add review time for deposit analysis.
1099 loans require full returns. Bank statement loans typically don't, though some lenders ask for them to verify you filed.
Rates vary by borrower profile and market conditions. 1099 loans sometimes price slightly better, but strong credit and down payment narrow the gap.
Yes. Rideshare drivers, freelancers, and contractors qualify if they show 12-24 months of consistent 1099 income or deposits.