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in Wildomar, CA
Self-employed borrowers in Wildomar have unique financing needs that traditional mortgages don't address. Both 1099 loans and bank statement loans offer alternatives for independent contractors and business owners.
These non-QM loan options skip W-2 verification and use different methods to prove your income. Choosing the right one depends on how you receive income and what documentation you can provide.
Rates vary by borrower profile and market conditions. Understanding each loan type helps you select the best path to homeownership in Riverside County.
1099 loans help independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages. This program uses your 1099 forms to verify income directly from your tax documents.
You'll need consistent 1099 income from one or more clients. Lenders typically review your 1099 forms from the past one to two years to determine qualifying income.
This option works well if you have clean 1099 documentation and limited business expenses. It's straightforward for contractors who don't operate complex business structures.
Bank statement loans use 12 to 24 months of bank statements to verify income for self-employed borrowers. This non-QM program analyzes deposits to determine your earning capacity.
Lenders examine your business or personal bank statements for consistent income patterns. They calculate average monthly deposits to establish your qualifying income amount.
This option benefits business owners who write off significant expenses. It captures your true cash flow rather than taxable income shown on returns.
The main difference lies in documentation requirements and who benefits most. 1099 loans rely on tax forms from clients, while bank statement loans examine deposit patterns in your accounts.
Bank statement loans often work better for business owners with high write-offs that reduce taxable income. 1099 loans suit contractors whose 1099 income closely reflects their actual earnings.
Processing may differ slightly between the two programs. Bank statement loans require more detailed account analysis, while 1099 loans follow a more straightforward documentation review.
Choose 1099 loans if you receive most income through 1099 forms and claim minimal business expenses. This works best for consultants, freelancers, and contractors with simple income structures.
Bank statement loans fit better if you run a business with significant deductions or mixed income sources. This option captures cash flow that tax returns might not reflect accurately.
Talk with a Wildomar mortgage broker to review your specific situation. They can analyze your documentation and recommend the program that maximizes your buying power in Riverside County.
Yes, many self-employed borrowers qualify for both programs. Your lender will recommend whichever option provides better qualifying income based on your documentation.
Rates vary by borrower profile and market conditions for both programs. Your credit score, down payment, and documentation strength affect your rate more than the loan type.
Both typically take 30-45 days to close. Bank statement loans may need slightly more time for deposit analysis, but timelines are generally comparable.
Most lenders request tax returns for both programs as supporting documentation. However, they're not the primary income verification method for either loan type.
Both programs typically require 10-20% down, depending on the lender and your profile. Larger down payments often secure better terms and rates.