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in Malibu, CA
Malibu's luxury market attracts business owners, creatives, and entrepreneurs who don't fit traditional lending boxes. Both bank statement and P&L loans solve the same problem—proving income without W-2s—but they use different documentation.
Your business structure and accounting setup determine which path works better. Most self-employed borrowers can qualify through either route, but one will be cleaner for your specific situation.
Bank statement loans use 12 or 24 months of personal or business bank deposits to calculate qualifying income. Lenders average your deposits and apply a percentage based on your business type—usually 50% to 75%.
No tax returns required. This matters for borrowers who write off aggressive expenses or run newer businesses. You need consistent deposits and reasonable cash flow management—no overdrafts or NSF fees in recent months.
Most programs allow up to 90% loan-to-value with credit scores starting at 680. Rates run 1% to 2% higher than conventional loans. Rates vary by borrower profile and market conditions.
P&L loans require a CPA-prepared profit and loss statement covering 12 to 24 months. The lender uses net income from your P&L to calculate debt-to-income ratio, similar to how conventional loans work.
You still need a CPA letter confirming they prepared the statement. Most lenders also require a business license and proof your company has operated for at least two years. This route works better if you already maintain clean books.
Loan-to-value caps out around 85% to 90% depending on the program. Credit requirements mirror bank statement loans—680 minimum for most lenders. Some investors prefer P&L documentation because it looks more traditional.
Bank statement loans focus on cash flow—what actually moves through your accounts. P&L loans focus on profitability—what your CPA reports after expenses. If you write off everything, bank statements show higher qualifying income.
Documentation speed differs significantly. Bank statements take minutes to download. A CPA-prepared P&L takes days or weeks if your books aren't current. For time-sensitive Malibu deals, that gap matters.
Both programs hit similar rate ranges, but bank statement loans offer more flexibility on business age and structure. P&L loans appeal to lenders who want traditional accounting documentation, which sometimes opens more investor options.
Choose bank statement loans if you write off heavy expenses, run a newer business, or need to close fast. They work well for contractors, real estate agents, and anyone with strong deposits but low reported net income.
Choose P&L loans if you already work with a CPA, maintain detailed books, and prefer documentation that looks more like traditional lending. Corporate structures and established businesses often find this path smoother.
Most borrowers who qualify for one can qualify for both. We run both scenarios during pre-approval to see which produces better debt-to-income numbers. The difference often comes down to how your specific business reports income versus how cash actually flows.
No. Lenders require one documentation method per loan file. We choose whichever produces the higher qualifying income for your situation.
Mostly yes. Both typically max out at 90% LTV, meaning 10% down minimum. Your credit score and property type affect final leverage.
Bank statement loans close faster because you don't wait for CPA prep. Documentation turnaround typically takes 1-3 days versus 1-3 weeks.
Rates are nearly identical. Your credit score, down payment, and loan amount drive pricing more than documentation type.
Bank statement loans can work with 12 months of deposits. P&L programs almost always require two years of business operation.
Recent overdrafts or NSF fees hurt bank statement approvals. Lenders want to see responsible cash management over 12-24 months.