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in Burbank, CA
Both 1099 and bank statement loans target self-employed Burbank borrowers who can't document income the W-2 way. The difference lies in which paperwork lenders use to prove you earn enough to qualify.
Most independent contractors have 1099s from clients. Most business owners deposit cash into accounts without perfect 1099 documentation. That split determines which loan works for your situation.
1099 loans use your IRS 1099 forms to calculate qualifying income. Lenders average your 1099 earnings over 12 to 24 months, then apply standard debt-to-income ratios to see what you can afford.
This option works best for contractors, consultants, and freelancers who receive clear 1099-MISC or 1099-NEC forms from clients. You'll need minimal write-offs on your tax returns since lenders qualify you on reported income, not bank deposits.
Credit requirements sit around 620 minimum for most programs. Down payments start at 10% but better rates and terms show up at 15% to 20% down in competitive Burbank neighborhoods.
Bank statement loans skip tax returns entirely. Lenders review 12 to 24 months of personal or business bank deposits to calculate your monthly income, then qualify you on that number.
This program fits business owners who write off significant expenses or mix personal and business income. Underwriters analyze deposits, subtract transfers and non-income items, then apply debt ratios to what remains.
Expect 10% to 20% down depending on credit strength and property type. Many Burbank media professionals and small business owners use this route when their tax returns don't reflect actual cash flow.
Documentation separates these programs. 1099 loans need clean IRS forms showing income from clients. Bank statement loans need consistent deposits but don't care what your tax return says.
Rate pricing differs slightly. 1099 loans often price closer to conventional rates because the documentation feels more formal to lenders. Bank statement loans add 0.25% to 0.75% since underwriters do more manual work analyzing deposits.
Write-offs create the biggest split. If you claimed $80K in business expenses but deposited $200K, bank statements work better. If your 1099s show $180K and you wrote off $20K, the 1099 loan route makes more sense.
Choose 1099 loans if you receive clear forms from multiple clients and your tax returns reflect most of your income. This route closes faster because lenders don't analyze every deposit line by line.
Pick bank statement loans if business write-offs slash your reported income or you run cash through accounts without perfect 1099 documentation. You'll pay slightly more in rate but qualify on real cash flow instead of taxable income.
Many Burbank entertainment industry freelancers fit the 1099 profile. Restaurant owners, contractors with material costs, and retail operators often need bank statements since expenses eat reported profit.
Not typically. Lenders pick one income calculation method per file. Some will review both and choose whichever qualifies you for more house.
No. Personal accounts work if they show consistent income deposits. Business accounts often make underwriting cleaner but aren't required.
1099 loans price 0.25% to 0.75% lower on average. Rates vary by borrower profile and market conditions, so both options need quotes.
1099 loans need 12-24 months of forms. Bank statement loans need 12-24 months of statements showing deposits.
Yes. Many borrowers start with bank statements then refinance to conventional or 1099 loans after adjusting write-off strategies.