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Profit & Loss Statement Loans in Artesia
Artesia's small business community—from Pioneer Boulevard retail to auto repair shops—often struggles with traditional mortgage requirements. W-2s don't exist when you run your own operation.
P&L statement loans solve this. A CPA-prepared profit and loss statement replaces tax returns for income verification. Most self-employed borrowers show lower taxable income than actual cash flow, making this route essential.
You need a CPA or licensed accountant to prepare your P&L statement covering 12-24 months of business income. Most lenders want two years in business, though some approve after one year.
Credit scores typically start at 620, though 680+ gets better rates. Expect 10-20% down depending on property type and loan amount. Business bank statements may be required as backup documentation.
P&L loans come exclusively from non-QM lenders—traditional banks won't touch them. Rates run 1-2% higher than conventional mortgages because underwriting relies on business income verification, not tax returns.
Lender overlays vary dramatically. Some require reconciliation between P&L and bank deposits. Others accept the P&L at face value if prepared by a licensed CPA. Finding the right lender match saves thousands.
The CPA relationship matters more than borrowers realize. Some preparers inflate income hoping to help, which backfires during underwriting. Conservative, well-documented P&Ls sail through approval.
I tell Artesia clients to have their CPA ready before rate shopping. Lenders calculate income differently—some average two years, others take the most recent 12 months. Knowing your qualifying income prevents surprises mid-process.
Bank statement loans offer an alternative—12-24 months of business deposits replace the P&L. That works when your CPA relationship is weak or your business shows inconsistent monthly income but strong overall deposits.
DSCR loans avoid personal income entirely for investment properties. The rental income covers the mortgage, so your business financials don't matter. Artesia investors with multiple properties often prefer this route.
Artesia's mixed-use properties complicate P&L loans. When your business operates from the same building you want to finance, lenders scrutinize the business-personal income split. Clear separation in your P&L helps.
Los Angeles County appraisals can delay closings. Non-QM lenders require full appraisals, and in Artesia's smaller market, finding comparable sales takes longer. Build extra time into your purchase timeline.
No. Lenders require CPA, EA, or licensed accountant preparation. Self-prepared statements won't pass underwriting regardless of accuracy.
Some lenders approve after 12 months with strong P&L and higher down payment. Two years in business opens more options and better rates.
Most lenders want to see filed returns even though they use P&L for income calculation. The returns verify business existence and filing compliance.
They contact your CPA directly and often request business bank statements. Some cross-check deposits against reported income looking for major discrepancies.
Yes, though DSCR loans often make more sense. They ignore personal income entirely and qualify based on rental income alone.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.