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Profit & Loss Statement Loans in Pasadena
Pasadena's self-employed professionals need mortgages that match how they actually earn. P&L loans skip tax returns and qualify you on a CPA-prepared profit and loss statement instead.
This matters in a city where business owners write off expenses aggressively. Your tax return shows $80k, but your P&L proves you clear $200k. Lenders fund based on the higher number.
You need 12-24 months of profit and loss statements prepared by a licensed CPA. Most lenders want 620+ credit and 20% down, though some accept 15% with strong income documentation.
This loan fits business owners, freelancers, and 1099 contractors who show inconsistent tax returns but steady monthly revenue. Your CPA calculates average monthly income across the P&L period.
P&L loans come from non-QM lenders, not big banks. Rates run 1-2% higher than conventional mortgages because lenders price the documentation risk. Your CPA's credentials matter — sloppy prep kills deals.
Shop multiple non-QM lenders. Some cap loan amounts at $2M, others go to $4M. Underwriting speed varies wildly — ask about turn times before you lock a rate.
I see borrowers confused about the CPA requirement. Your bookkeeper can't prepare these. The lender verifies your CPA's license directly with the state board. Use a licensed professional from the start.
P&L loans make sense when your write-offs exceed $40k annually. Below that threshold, a bank statement loan often prices better and requires less paperwork. Run both scenarios before choosing.
Bank statement loans use 12-24 months of deposits to calculate income. P&L loans use your CPA's income calculation instead. Bank statements work faster but may show lower qualifying income if you mix business and personal funds.
1099 loans verify income through your 1099 forms alone. They price cheaper than P&L loans but won't work if you write off most of your revenue. DSCR loans skip personal income entirely and qualify you on rental property cash flow.
Pasadena's mix of tech contractors, medical professionals, and creatives creates heavy demand for non-QM products. Properties near Old Town and the Huntington Library run $800k-$2M+, making the 20% down requirement steep.
Los Angeles County has high property taxes and some lenders cap total debt ratios at 43% for P&L loans. Budget for taxes and insurance when calculating what you can afford. Many Pasadena borrowers underestimate carrying costs.
No. Your CPA needs a valid California license or license from any U.S. state. Lenders verify credentials electronically regardless of location.
Most lenders require 24 months of business history. Some accept 12 months if you show strong cash reserves and prior industry experience.
Lenders average income across all months provided. One weak quarter won't kill the deal if your overall trend shows profitability and stable revenue.
Figure 15-25 days from application to clear-to-close. CPA verification and income calculation add time versus standard loans.
Yes. Cash-out and rate-term refinances both work. Same qualification rules apply as purchase transactions.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.