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in Beverly Hills, CA
Both 1099 and bank statement loans help self-employed Beverly Hills buyers qualify without W-2 income. The main difference is how lenders calculate your qualifying income.
1099 loans use tax forms to prove earnings. Bank statement loans use deposits from 12 or 24 months of statements. Your business structure and write-offs determine which one gets you a bigger loan.
1099 loans use your 1099 forms to verify income. Lenders look at one or two years of forms, then calculate an average monthly income. This works best if your 1099 income is consistent and you don't take big deductions.
Most lenders want 12-24 months of 1099 history. You'll need decent credit, usually 620 minimum. Down payments start at 10-15% but depend on your debt-to-income ratio and the property type.
Bank statement loans skip tax returns entirely. Lenders review 12 or 24 months of business or personal bank statements. They calculate income from your average monthly deposits, minus obvious business expenses.
This option works if you write off most of your gross income. Lenders typically use 50% of deposits as qualifying income for personal accounts, higher percentages for business accounts. Credit requirements start around 620, and down payments run 10-20%.
1099 loans work better if your tax returns show strong income. Bank statement loans win if you write off 60-70% of what you earn. Most self-employed Beverly Hills borrowers have bigger qualifying income with bank statements.
Documentation is cleaner with 1099 loans—just a few forms. Bank statement loans require every page of 12-24 months of statements. Rates vary by borrower profile and market conditions, but both programs price similarly once you factor in credit and down payment.
Choose 1099 loans if you're a contractor with minimal expenses and clean tax returns. Choose bank statement loans if you're a business owner who deducts aggressively. Most real estate agents, consultants, and service providers qualify for more with bank statements.
Run both scenarios before you decide. Pull your 1099s and calculate average monthly income. Then look at your bank deposits and assume 50% counts as qualifying income. Whichever number is higher should guide your application strategy.
No. Lenders use one income calculation method per loan. You pick the documentation type that shows higher qualifying income.
Rates are similar for both programs. Your credit score, down payment, and debt ratios have more impact than the documentation type.
No. Lenders accept personal or business accounts. Business statements often qualify a higher percentage of deposits as income.
Both programs typically require 620 minimum. Higher credit scores unlock better rates and lower down payment requirements.
Expect 30-45 days. Bank statement loans take longer because underwriters review every page of 12-24 months of statements.