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in Irwindale, CA
Both 1099 and bank statement loans solve the same problem: proving income without W-2s. The difference is how lenders calculate what you actually make.
Most self-employed Irwindale borrowers qualify for one but not both. Your income documentation determines which path closes faster and costs less.
1099 loans use your tax forms from contractors who paid you. Lenders average your 1099 income across 12-24 months to determine what you can borrow.
This works best if you have consistent contractor relationships and clean 1099s. You need less documentation than bank statement programs require.
Rates typically run 0.25% to 0.75% lower than bank statement loans. Fewer pages to review means faster underwriting and lower lender risk pricing.
Bank statement loans use 12-24 months of business or personal bank deposits. Lenders analyze your statements to calculate average monthly income.
This program works when you take few or no 1099s. Cash businesses, gig workers with app-based payments, and business owners who reinvest profits all qualify.
You avoid tax return reviews entirely. Lenders look only at cash flow through your accounts, which helps if your tax returns show minimal income.
1099 loans need contractor tax forms. Bank statement loans need deposit records. If you have clean 1099s, that route costs less and closes faster.
Bank statement programs charge higher rates because underwriters manually review every deposit. You pay 0.5% to 1% more than 1099 financing.
Credit requirements differ slightly. Most 1099 programs accept 620 scores. Bank statement lenders want 640 minimum because the income documentation carries more risk.
Choose 1099 loans if you receive tax forms from most clients. The lower rate saves thousands over the loan term, and underwriting takes half the time.
Pick bank statement financing if you run a cash business, take few 1099s, or your tax returns show low income due to write-offs. You pay more in rate but actually qualify.
Some Irwindale borrowers mix both programs. You might use 1099 income for part of qualifying and add bank statements to hit the debt ratio you need.
Yes. Many self-employed borrowers combine both income types to maximize qualifying power. Lenders blend the documentation to calculate total monthly income.
1099 loans typically close 5-7 days faster. Bank statement underwriting requires manual deposit review, which extends timelines even with responsive borrowers.
1099 loans need your personal returns to match reported income. Bank statement programs skip tax returns entirely and qualify on deposits alone.
Most 1099 programs accept 620 credit scores. Bank statement lenders typically require 640 minimum due to the manual income verification process.
1099 loans save significant money long-term. A 0.75% rate difference costs roughly $45,000 extra interest on a $400,000 loan.