Question 1

Does my CPA need special credentials to prepare the P&L?

Accepted Answer

Your CPA must hold an active license in good standing. Most lenders verify credentials directly with state boards before accepting the P&L.

Question 2

Can I combine P&L income with W-2 income from a spouse?

Accepted Answer

Yes, most lenders allow combined income. Your P&L gets averaged monthly and added to stable W-2 earnings for total qualifying income.

Question 3

What if my business is only 18 months old?

Accepted Answer

You won't qualify for standard P&L programs requiring two years. Bank statement loans with 12-month history offer better approval odds.

Question 4

How do lenders verify the P&L isn't inflated?

Accepted Answer

They cross-check against business bank deposits and request CPA engagement letters. Some require direct CPA contact to confirm financials.

Question 5

Are interest rates fixed or adjustable on P&L loans?

Accepted Answer

Both exist. Fixed rates cost more upfront but stabilize payments. ARMs start lower but adjust after initial fixed periods.

Question 6

Can I refinance a conventional loan into a P&L loan?

Accepted Answer

Yes, if you've become self-employed since the original loan. Cash-out refinances work but require seasoning on the current mortgage.

Profit & Loss Statement Loans in Clovis: Income Verification Without Tax Returns