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in Dana Point, CA
Self-employed borrowers in Dana Point have two strong mortgage options. Both 1099 Loans and Bank Statement Loans help independent workers qualify without W-2 income.
These non-QM loan programs use alternative documentation to verify income. Each works best for different types of self-employed borrowers. Understanding the differences helps you choose the right path.
1099 Loans serve independent contractors and freelancers who receive 1099 forms. Your 1099 income statements prove your earnings to lenders. This works well if you have consistent contracts.
Lenders review your 1099 forms from the past one or two years. They calculate your qualifying income from these documents. This option suits contractors with straightforward 1099 income streams.
Bank Statement Loans use 12 to 24 months of personal or business bank statements. Lenders analyze deposits to determine your average monthly income. This works for business owners who don't rely on 1099 forms.
You don't need tax returns or 1099 forms with this option. The lender reviews your bank deposits and calculates qualifying income. This flexibility helps self-employed borrowers with complex income structures.
The main difference is documentation type. 1099 Loans require 1099 forms from clients or contractors. Bank Statement Loans only need your bank statements showing deposits.
Bank Statement Loans offer more flexibility for diverse income sources. 1099 Loans work best when your income comes through clear contractor relationships. Rates vary by borrower profile and market conditions for both programs.
Choose 1099 Loans if most income comes from contractor work with clear 1099 documentation. This option streamlines approval when you have consistent 1099 forms. It's straightforward for freelancers and consultants.
Pick Bank Statement Loans if you own a business with multiple income streams. This works when income doesn't arrive through 1099 forms. It's ideal for business owners who write off many expenses or have cash-heavy businesses.
A Dana Point mortgage broker can review your specific situation. They'll compare both options against your documentation and income type. The right choice depends on how you receive and document earnings.
Some lenders allow combining documentation types. A mortgage broker can structure your application to use your strongest income proof. This flexibility helps maximize your qualifying amount.
Rates vary by borrower profile and market conditions for both programs. Your credit score, down payment, and documentation quality affect pricing. Compare offers from multiple lenders for the best rate.
Most lenders prefer two years of self-employment income. Some programs accept one year with strong compensating factors. Bank Statement Loans may offer more flexibility than 1099 Loans on this requirement.
Closing times are similar for both loan types, typically 30-45 days. 1099 Loans may process slightly faster with clear documentation. Bank Statement Loans take longer if underwriters need to analyze complex deposits.
Real estate agents can share general information about both options. However, mortgage brokers provide detailed guidance on which program fits your income documentation. Always consult a licensed loan officer.