Question 1

Can I use both 1099s and bank statements together?

Accepted Answer

No. Lenders pick one income method per file. You can't combine 1099 income with bank statement income to boost your qualifying amount.

Question 2

Which loan type has lower rates?

Accepted Answer

Rates are nearly identical. Both are non-QM products priced 1 to 2 points above conventional loans based on credit, down payment, and loan amount.

Question 3

Do I need two years of self-employment history?

Accepted Answer

Most lenders want 24 months in the same line of work. Some accept 12 months if income is strong and stable with high credit.

Question 4

What if my 1099 income dropped last year?

Accepted Answer

Declining income hurts both loan types. Lenders average your income, so a drop reduces your qualifying power or kills approval entirely.

Question 5

Can I use business bank statements if I'm incorporated?

Accepted Answer

Yes. Bank statement loans accept business accounts for LLCs, S-corps, and sole proprietors. Lenders apply expense ratios based on your business structure.

1099 Loans vs Bank Statement Loans: Which Income Docs Work for Torrance Self-Employed Buyers?