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in Los Banos, CA
Self-employed borrowers in Los Banos face a common problem: tax returns don't show their real income. Both bank statement and P&L statement loans solve this, but they work differently.
Bank statement loans rely on deposits to calculate income. P&L loans need a CPA to prepare financial statements. Your choice depends on how you run your business and what paperwork you already have.
Bank statement loans analyze 12 to 24 months of business or personal bank statements. Lenders calculate your income by reviewing deposits and applying a percentage based on your business type.
Most programs accept personal deposits, business deposits, or both. You don't need perfect books or a CPA relationship. If money hits your account consistently, you can qualify.
Credit requirements typically start at 620. Expect 10-20% down depending on loan amount and credit profile. Rates run higher than conventional loans because of the non-QM structure.
P&L statement loans require a CPA-prepared profit and loss statement covering 12-24 months. The CPA must be licensed and unrelated to you. Some lenders also want a business license or articles of incorporation.
This route works well if you already work with a CPA for your business. The statements need to show consistent income. Lenders verify the CPA's credentials and may call to confirm they prepared the documents.
Credit and down payment requirements mirror bank statement programs. You're trading bank statement volume for formal financial statements. The underwriting process focuses on your CPA's work rather than raw deposits.
The main split is paperwork versus professional help. Bank statement loans need volume: every deposit for one to two years. P&L loans need a CPA relationship and formal statements.
Bank statement programs calculate income directly from deposits. P&L programs rely on how your CPA categorizes revenue and expenses. If you write off everything for tax purposes, P&L statements might show stronger income than your tax returns but weaker than raw deposits.
Processing time differs too. Bank statements are straightforward but tedious to compile. P&L loans move faster once you have the statements, but getting them prepared takes time if you don't already work with a CPA.
Choose bank statement loans if you don't use a CPA or run a simple operation. Contractors, truckers, and consultants with clean deposit patterns fit this program. You need organized records but not formal accounting.
Go with P&L loans if you already pay a CPA or have complex business finances. This works for borrowers with multiple revenue streams, partnerships, or established businesses with formal bookkeeping. The CPA relationship becomes an asset instead of an extra cost.
Los Banos buyers often prefer bank statements for speed and simplicity. But if your deposits fluctuate wildly or mix personal and business funds heavily, P&L statements give underwriters a cleaner picture of your income.
No. Lenders use one method or the other, not both. Pick the program that matches your existing documentation and business setup.
Rates are similar since both are non-QM programs. Your credit score and down payment matter more than which income documentation you use.
Expect 1-2 weeks if you have organized records. If your books are messy, it could take a month or more and cost several hundred dollars.
They can, but consistent deposits make approval easier. Large fluctuations require explanation and may lower your qualifying income.
Yes, but it resets your timeline. Most borrowers know which program fits after one conversation with their broker.