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in Placentia, CA
Self-employed borrowers in Placentia have multiple financing options beyond traditional mortgages. Both 1099 loans and bank statement loans help independent workers qualify without W-2 income.
These non-QM loan programs serve Orange County's growing self-employed community. Each option verifies income differently, making one potentially better for your situation.
Understanding how these loans work helps you choose the right path. Rates vary by borrower profile and market conditions for both programs.
1099 loans help independent contractors and freelancers qualify using their 1099 income forms. This option works well if you receive regular 1099 statements from clients.
Lenders review your 1099 forms to calculate qualifying income. You typically need one to two years of consistent 1099 earnings to qualify.
This program is ideal for contractors with straightforward income documentation. Your 1099 forms provide clear evidence of your earning history.
Bank statement loans use 12 to 24 months of bank statements to verify your income. Lenders analyze deposits to determine your qualifying earnings.
This option works for self-employed borrowers who may not have extensive 1099 documentation. Business owners and freelancers with varied income sources often benefit most.
The bank statement review captures your actual cash flow. This can reveal higher qualifying income than tax returns show after deductions.
The main difference is documentation type: 1099 forms versus bank statements. 1099 loans rely on third-party income verification from clients.
Bank statement loans offer more flexibility for business owners with expenses. They review actual deposits rather than reported taxable income.
Processing times and requirements vary between programs. Your income structure determines which documentation method works better for you.
Choose 1099 loans if you receive regular 1099 forms from multiple clients. This works well for consultants and contractors with clear income trails.
Bank statement loans suit business owners who write off significant expenses. They're also better if you lack consistent 1099 documentation but have steady deposits.
Consider your specific income documentation and business structure. A Placentia mortgage broker can review your situation and recommend the best fit.
Some lenders may consider both, but typically you'll use one program or the other. A mortgage broker can determine which documentation shows your income best.
Rates vary by borrower profile and market conditions for both programs. Your credit score, down payment, and specific income situation affect your rate more than the loan type.
Most programs require one to two years of self-employment history. Some lenders may accept less time if you worked in the same field previously as an employee.
Yes, both 1099 and bank statement loans can finance investment properties. Qualification requirements may differ slightly from primary residence loans.
Down payment requirements typically range from 10% to 20% or more. Your specific down payment depends on credit score, property type, and loan amount.