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in Sierra Madre, CA
Sierra Madre buyers with self-employment income have two strong paths to homeownership. 1099 loans and bank statement loans both serve contractors, freelancers, and business owners who don't fit the W-2 mold.
Each program weighs documentation differently and carries distinct rate and down-payment profiles. The 2026 conforming limit for Sierra Madre is $1,249,125. Los Angeles County's median household income is $87,760.
1099 loans key off your tax returns and reported business income. Lenders average your last two years of 1099 income and apply standard debt-to-income ratios.
Credit floors typically start at 660–680 FICO. Down payments run 15–25% depending on reserves and business stability.
Bank statement loans skip tax returns entirely and use your actual deposit history instead. Lenders review 12–24 months of bank statements to calculate qualifying income.
Credit requirements are similar: 660–680 FICO range. Down payments typically land 15–25% depending on reserves.
1099 loans rely on filed tax returns, which means your reported income is already documented. Bank statement loans ignore tax returns and instead count actual deposits.
If your tax return shows less income than you actually deposit, bank statements win. Closing speed favors 1099 loans because underwriters don't need manual verification.
Choose 1099 loans if your tax returns accurately reflect your business income. You'll close faster and your underwriting is simpler.
Bank statement loans make sense when deposits exceed reported income. Contractors with cash jobs or rental income should compare statements.
Yes. Both programs typically require 660–680 FICO minimum. Some lenders go lower with compensating factors like reserves.
1099 loans close faster because underwriters use your filed tax returns. Bank statement loans require manual verification of deposits.
Yes. Bank statement loans qualify you on actual deposits, not reported income. This helps if your tax return understates cash flow.
Both programs typically require 15–25% down. The exact amount depends on your FICO score, reserves, and lender overlays.