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in Maywood, CA
Most Maywood self-employed buyers can't qualify using tax returns. Write-offs kill your qualifying income, even when the business is thriving.
Bank statement and P&L loans solve that problem differently. One uses raw deposits, the other uses a CPA's math—both ignore your tax returns entirely.
Bank statement loans use 12 to 24 months of business deposits to calculate income. Lenders pull your average monthly deposits and apply a qualifying percentage based on your business type.
No CPA needed. Just upload statements showing consistent deposits. Most borrowers qualify using 50-75% of gross deposits depending on business expenses.
Processing runs faster because underwriters review actual bank activity. They see every deposit and withdrawal—transparency speeds up approval once statements are clean.
P&L loans require a CPA-prepared profit and loss statement covering 12-24 months. Your accountant creates a detailed income breakdown that lenders use for qualification.
The CPA must be licensed and independent—no family members. Some lenders also want a balance sheet and a signed letter verifying the numbers.
This route works better if your bank statements show irregular deposits or commingled funds. The P&L cleans up messy cash flow into underwriter-friendly numbers.
Bank statement loans review raw cash flow. P&L loans review an accountant's interpretation of that cash flow. That difference matters when deposits look messy.
Rates vary by borrower profile and market conditions, but bank statement loans typically run 0.25-0.50% higher. You pay slightly more for the convenience of skipping a CPA.
Processing speed favors bank statements when your deposits are clean and consistent. P&L loans take longer because underwriters verify CPA credentials and cross-check the math.
Use bank statements if deposits hit the same account every month with minimal personal spending mixed in. Upload statements, get approved, close fast.
Use a P&L if you commingle funds, have seasonal income swings, or run multiple business accounts. The CPA normalizes everything into clean qualifying income.
Most Maywood contractors and service businesses fit bank statement loans perfectly. Real estate agents and commission-based earners with variable months do better with P&L preparation.
Yes, if business income hits your personal account. Lenders calculate income the same way but scrutinize personal spending more closely.
No. That's the whole point—you skip tax returns entirely. The CPA prepares a standalone P&L that replaces tax documentation.
Both typically require 620-640 minimum. The documentation method doesn't change credit standards—lenders price risk the same way.
Yes, but it restarts underwriting. If bank statements aren't working, ordering a P&L adds 1-2 weeks to your timeline.
Yes. Both support purchase and cash-out refi. Documentation requirements stay the same regardless of loan purpose.