Loading
in Clovis, CA
Self-employed borrowers in Clovis face a common problem: tax write-offs tank your W-2-equivalent income. Both bank statement and P&L loans solve this by documenting income differently than traditional lenders require.
The right choice depends on how you structure your business and what documentation you already maintain. Most Clovis entrepreneurs prefer one over the other based on their accounting setup.
Bank statement loans use 12 to 24 months of business or personal bank deposits to calculate income. Lenders apply a percentage (typically 50-75%) to your average monthly deposits as qualifying income.
This works well for cash-heavy businesses or contractors who run most revenue through their accounts. You avoid the CPA cost and can qualify faster since you already have the statements.
Rates typically run 1-2% higher than conventional loans. Credit scores above 680 get better pricing, and most lenders want 10-20% down depending on loan amount.
P&L loans require a CPA-prepared profit and loss statement covering 12-24 months. The lender uses your net profit as qualifying income without the write-off penalty that kills conventional approvals.
This route fits borrowers who already work with CPAs for quarterly financials or complex business structures. The documentation carries more weight with underwriters than raw bank deposits.
Pricing sits close to bank statement loans but some lenders offer slightly better rates for CPA-prepared docs. You still need 10-20% down and similar credit requirements.
The core split is documentation style versus cost. Bank statement loans let you skip the CPA and use existing records. P&L loans require professional preparation but give you cleaner income documentation.
Cash flow matters more with bank statements since deposits drive approval. P&L loans focus on profitability, which helps if you reinvest heavily or carry inventory that ties up cash.
Choose bank statements if you run deposits through your accounts consistently and want to avoid CPA costs. This works for contractors, consultants, and service businesses with predictable cash flow.
Go with P&L if you already maintain CPA-prepared financials or run a business where cash deposits don't reflect true profitability. Retail, manufacturing, and multi-entity structures often fit better here.
Neither option guarantees better rates or terms—your credit score and down payment matter more. We see approval rates across both programs for qualified Clovis borrowers.
Yes, if business income runs through personal accounts. Lenders will analyze deposits and exclude non-income transfers like loan proceeds or account movements.
The CPA must be licensed and in good standing. Most lenders accept any active CPA license without requiring additional mortgage-specific certifications.
Bank statement loans typically close quicker since you skip CPA preparation time. P&L loans add 1-2 weeks if you need to commission new statements.
Yes, but it resets underwriting timelines. We usually know which fits better after reviewing your business structure in the first conversation.
Both work for investment properties with higher down payments. Expect 20-25% down on non-owner-occupied purchases regardless of documentation type.