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in San Juan Capistrano, CA
Self-employed borrowers in San Juan Capistrano have unique financing needs. Traditional mortgage lenders often struggle to verify income for independent contractors and business owners.
Both 1099 loans and bank statement loans offer solutions for self-employed professionals. These non-QM options provide flexibility when W-2 income documentation isn't available.
Understanding the differences helps you choose the right loan for your situation. Your income structure and documentation will guide which option works best.
1099 loans help independent contractors and freelancers who receive 1099 forms for their income. These loans use your 1099 documentation instead of traditional W-2 wage statements.
This option works well if you have consistent 1099 income from clients. Lenders review your 1099 forms to determine your qualifying income amount.
You'll need organized tax records and 1099 forms from recent years. This straightforward approach matches borrowers who already receive 1099 documentation.
Bank statement loans use 12 to 24 months of personal or business bank statements. This non-QM option calculates income from deposits rather than tax returns.
Self-employed business owners often benefit from this approach. Lenders analyze your bank deposits to determine qualifying income.
You avoid relying solely on tax returns that may show reduced income. Bank statements reveal actual cash flow for your business operations.
The main difference lies in documentation requirements and income calculation methods. 1099 loans rely on tax forms while bank statement loans analyze deposit patterns.
1099 loans suit contractors with straightforward 1099 income streams. Bank statement loans work better for business owners with varied income sources and business expenses.
Both programs offer alternatives to traditional mortgage qualifying. Your specific income structure determines which documentation method works better for you.
Choose 1099 loans if you primarily earn income as an independent contractor. This option makes sense when you receive regular 1099 forms from clients.
Bank statement loans fit business owners who write off significant expenses. They also help borrowers whose tax returns don't reflect true earning capacity.
Consider your documentation availability and how you structure your business income. A qualified mortgage broker in San Juan Capistrano can review your specific situation and recommend the best fit.
Yes, some borrowers qualify for both programs. Your lender will analyze which option provides better terms based on your income documentation and financial profile.
Rates vary by borrower profile and market conditions. Both programs typically offer competitive non-QM rates based on your credit, down payment, and income stability.
1099 loans require recent 1099 forms and tax returns. Bank statement loans need 12-24 months of personal or business bank statements showing consistent deposits.
Yes, both loan types can finance primary residences, second homes, and investment properties. Specific terms depend on property type and your borrower profile.
Credit requirements vary by lender and program. Most non-QM lenders accept credit scores starting around 600-620, though better scores improve your terms.