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in Fowler, CA
Self-employed borrowers in Fowler face a common problem: your 1040 shows lower income than what actually hits your bank account. Both bank statement and P&L loans solve this, but they prove income differently.
Bank statement loans let deposits speak for themselves. P&L loans rely on CPA-prepared financials. Your business structure and how you manage deductions determine which route gets you approved faster.
Bank statement loans analyze 12 to 24 months of business or personal deposits. Lenders calculate income by averaging deposits and applying an expense ratio, usually 25% to 50% depending on your industry.
You don't need a CPA or formal financial statements. Just provide bank statements showing consistent deposits. This works best if you run most revenue through your accounts and don't co-mingle funds heavily.
Most programs require 10% to 20% down and accept credit scores from 620 up. Rates run higher than conventional loans because lenders price in the alternative documentation risk.
P&L statement loans require a CPA-prepared profit and loss statement covering at least 12 months. Some lenders want two years. They calculate income from your bottom-line profit, not gross deposits.
This route works better if you write off significant expenses or operate an S-corp or LLC with complex accounting. Your CPA's reputation matters—lenders verify their credentials and may request additional documentation.
Down payment and credit requirements mirror bank statement loans: 10% to 20% down, 620+ credit. Pricing stays similar, though some lenders charge less if your CPA provides audited statements.
The core difference is proof of income. Bank statements show what came in. P&L statements show what you kept after expenses. If you write off 60% of revenue, P&L loans might qualify you for less.
Bank statement loans process faster because you don't need a CPA involved. P&L loans take longer but give you more control over how income presents, especially if your accountant can adjust timing on accruals.
For Fowler ag businesses, bank statement loans often work better. Seasonal revenue shows clearly in deposits. P&L statements can look erratic if harvest timing varies year to year.
Choose bank statement loans if you're a sole proprietor, operate service businesses with low overhead, or can't wait for CPA prep. They work well for contractors, consultants, and cash-heavy businesses.
Go with P&L loans if you run an S-corp or LLC, have significant legitimate deductions, or already maintain CPA-prepared books. Real estate investors and multi-entity owners usually prefer this route.
Most Fowler self-employed buyers qualify for both. We run your numbers through each method to see which produces higher qualifying income. Rates vary by borrower profile and market conditions.
Yes, most lenders accept personal statements if that's where your business income deposits. They'll still apply an expense ratio to estimate your net income.
Your CPA must be licensed and in good standing. Some lenders require CPAs with at least two years of practice and will verify their license directly.
It depends on your expense ratio and deductions. We calculate qualifying income both ways and recommend whichever shows stronger income for your situation.
Bank statement loans close in 21 to 30 days typically. P&L loans add one to two weeks if your CPA needs to prepare fresh statements.
Yes, if your first choice doesn't yield enough qualifying income. We often pivot mid-process when numbers don't work out as expected.