Question 1

How do lenders calculate income from bank statements?

Accepted Answer

Lenders average total deposits over 12 or 24 months, then apply a percentage based on your business type. Most use 50% of deposits, but some go higher if you document low expenses.

Question 2

Can I use personal bank statements instead of business statements?

Accepted Answer

Yes, personal statements work if they show regular income deposits. Business statements typically qualify for higher income calculations since lenders assume business expenses.

Question 3

What if my bank statements show irregular deposits?

Accepted Answer

Lenders look for consistent patterns, not identical amounts. Large one-time deposits usually get excluded from income calculation. Focus on showing regular business activity over the full statement period.

Question 4

Do bank statement loans have higher interest rates than conventional loans?

Accepted Answer

Yes, expect rates 1.00-2.50% higher than conventional loans as of February 2026. Rates vary by borrower profile and market conditions. Stronger credit and larger down payments reduce the spread.

Question 5

How long does underwriting take for bank statement loans?

Accepted Answer

Typical timeline runs 3-4 weeks from application to clear-to-close. Providing complete statements upfront speeds the process. Incomplete documentation adds 1-2 weeks.

Bank Statement Loans in Huron: Income Verification for Self-Employed Borrowers