Loading
in Larkspur, CA
Self-employed borrowers in Larkspur have two solid non-QM paths to mortgage approval. Both skip traditional W-2 verification, but they validate income differently.
1099 loans work for contractors with clean 1099 forms. Bank statement loans serve business owners who write off most of their income. Your documentation determines which fits.
1099 loans use your 1099 forms to prove income. Lenders typically average the past two years of 1099 earnings. If you're a contractor who doesn't own a business entity, this is usually your cleanest path.
The process mirrors traditional lending more closely. Underwriters look at gross 1099 income with fewer adjustments. You'll still need decent credit and standard down payment requirements apply.
Bank statement loans analyze 12 to 24 months of business or personal bank deposits. Underwriters calculate income from your actual cash flow. This works when tax returns show low net income due to business write-offs.
You're proving what you earn, not what you report to the IRS. Lenders typically use 50% to 100% of deposits as qualifying income, depending on the program. Expect higher rates than QM loans, but approval odds improve dramatically.
The split comes down to business structure. 1099 loans suit independent contractors filing Schedule C with minimal deductions. Bank statement loans work for LLC or S-corp owners who shelter income through business expenses.
Rate differences are minor between the two. Both price as non-QM products. Documentation complexity varies more—1099 loans need less paperwork, while bank statement programs require detailed deposit analysis and explanation of irregular transactions.
Choose 1099 loans if your 1099 income is strong and you don't own a business entity. Choose bank statement loans if you run an LLC or corporation and your tax returns don't reflect actual cash flow. Most tech consultants in Marin go 1099. Most business owners go bank statements.
The best move is to run both scenarios. We calculate qualifying income both ways and see which delivers higher approval amounts. Sometimes the difference is significant enough to change loan structure entirely.
No. Lenders use one income documentation method per loan. We choose whichever produces the higher qualifying income for your situation.
Most non-QM programs start at 10% down, though some allow less. Your credit score and income documentation quality affect the minimum requirement.
Typically two years. Some programs accept one year if you've been in the same line of work longer and can document stability.
You'll need to explain large or unusual deposits. Lenders exclude one-time windfalls and focus on recurring business income patterns.
Rates are similar since both are non-QM products. Your credit score and loan-to-value ratio matter more than which documentation method you use.