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in Firebaugh, CA
Most self-employed borrowers in Firebaugh have two paths to financing: bank statements or profit and loss statements. Both skip traditional tax returns, but they verify income differently.
Bank statement loans pull directly from your deposits. P&L loans require a CPA to prepare formal financial statements. The choice depends on how you run your business and what documentation you already maintain.
Bank statement loans use 12 to 24 months of business or personal bank statements to calculate income. Lenders typically count 50% to 75% of your average monthly deposits as qualifying income.
You avoid the CPA expense and the wait time for formal statements. Most borrowers use personal bank statements if they run income through one account. Business statements work if you operate a separate business account.
Credit requirements start around 620, though some lenders prefer 640 or higher. Down payments typically range from 10% to 20% depending on loan amount and property type.
P&L statement loans require a licensed CPA to prepare a profit and loss statement covering at least one year of business activity. Some lenders want two years. The CPA must be independent and licensed in California.
These loans work well if you already use a CPA for quarterly filings or business planning. The formal statement carries more weight with some lenders, which can help offset higher debt ratios.
Credit and down payment requirements mirror bank statement loans. You'll pay the CPA fee upfront, typically $500 to $1,500 depending on business complexity.
Bank statement loans cost less to document but cap your qualifying income at 50-75% of deposits. P&L loans add a CPA fee but may capture more income if your business has low overhead.
Processing time differs too. Bank statements come from your online portal. P&L statements require CPA preparation, which adds one to three weeks depending on your accountant's workload.
Interest rates run similar across both programs. Your rate depends more on credit score, loan amount, and down payment than which income documentation you choose.
Choose bank statement loans if you don't already work with a CPA and your deposits show consistent income. This works for contractors, agricultural workers, truckers, and most service businesses in Firebaugh.
Go with P&L loans if you maintain formal books and have an existing CPA relationship. This fits businesses with significant write-offs where net income on a P&L exceeds what bank deposits would show.
Both loans close in 25 to 35 days after documentation is complete. We shop both options across 200+ lenders to find the best rate and program fit for your business structure.
Yes, business statements work if all income flows through that account. Lenders apply the same 50-75% calculation to business deposits.
No. The CPA prepares a standalone P&L statement. You skip the full tax return filing that traditional loans require.
Rates are similar. Your credit score, down payment, and loan amount matter more than which documentation type you choose.
Sometimes, if you have time. Most lenders prefer you pick one path before application to avoid delays and re-documentation.
Yes. Ag businesses often use P&L loans because formal statements better capture seasonal income fluctuations and equipment costs.