Question 1

Who prepares the P&L statement for this loan?

Accepted Answer

A licensed CPA must prepare and sign it. Bookkeeper-prepared or self-prepared statements are not accepted by lenders.

Question 2

Do I need two years of self-employment history?

Accepted Answer

Most lenders require at least two years. Some non-QM programs allow 12 months with strong compensating factors.

Question 3

Can I use a P&L loan to buy in El Centro specifically?

Accepted Answer

Yes. P&L loans work statewide in California. El Centro's price range often makes qualification more attainable.

Question 4

How do lenders calculate income from a P&L?

Accepted Answer

They use net income shown on the statement, averaged over 12 or 24 months. Some lenders apply an expense factor to gross revenue instead.

Question 5

Are P&L loan rates higher than conventional rates?

Accepted Answer

Yes, typically. Non-QM products carry a rate premium over conventional loans. Rates vary by borrower profile and market conditions.

Question 6

What if my P&L shows inconsistent income month to month?

Accepted Answer

Seasonal fluctuations are common in Imperial County businesses. Lenders look at the full-period average, not individual months.

P&L Statement Loans for Self-Employed Buyers in El Centro