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in Newport Beach, CA
Self-employed borrowers in Newport Beach have multiple paths to homeownership. Both 1099 loans and bank statement loans offer alternatives to traditional mortgage qualification.
These non-QM options help independent contractors and business owners qualify without W-2 income. Each program uses different documentation to verify your earning power.
Understanding the key differences helps you choose the right fit. Your income structure and record-keeping habits often determine which option works best.
1099 loans serve independent contractors and freelancers who receive 1099 forms. This program uses your 1099 income statements to prove earning capacity.
You'll need consistent 1099 income documentation from your work. Lenders review your tax forms and 1099 statements to calculate qualifying income.
This option works well if you maintain organized tax records. It's ideal for consultants, gig workers, and contractors with clear 1099 documentation.
Bank statement loans use 12 to 24 months of bank statements to verify income. Lenders analyze deposits to calculate your average monthly earnings.
This non-QM option doesn't require tax returns or 1099 forms. You simply provide personal or business bank statements showing consistent deposits.
Self-employed borrowers with complex tax strategies often prefer this route. It captures your actual cash flow rather than taxable income.
The main difference lies in documentation requirements. 1099 loans rely on tax forms while bank statement loans use deposit history.
Bank statement loans may capture higher income for borrowers who write off expenses. 1099 loans work better when your tax returns reflect strong earnings.
Processing time can vary between programs based on documentation complexity. Bank statements often provide a clearer picture of cash flow for business owners.
Choose 1099 loans if you have consistent contractor income and clean tax records. This works well when your 1099 income accurately reflects your earnings.
Bank statement loans suit business owners with significant write-offs. They're ideal if your bank deposits exceed your reported taxable income.
Consider your record-keeping habits and income documentation. A Newport Beach mortgage broker can analyze your specific situation and recommend the best fit.
Yes, many self-employed borrowers qualify for both programs. Your broker will recommend the option that provides better loan terms based on your documentation.
Rates vary by borrower profile and market conditions. Neither program consistently offers better rates than the other. Your credit and down payment matter more.
Both typically take 30-45 days to close. Bank statement loans may process slightly faster if your statements are well-organized and show consistent deposits.
No, both programs accept lower credit scores than conventional loans. Most lenders require minimum scores around 600-620 for non-QM financing.
Yes, both 1099 loans and bank statement loans are available throughout Newport Beach and all of Orange County for eligible self-employed borrowers.