Question 1

Can I use both personal and business bank statements?

Accepted Answer

Yes, but separate accounts work better. Mixed statements require extensive documentation to prove which deposits count as income versus transfers or reimbursements.

Question 2

What income percentage do lenders use from deposits?

Accepted Answer

Typically 50-75% of gross deposits depending on business type. Service businesses get higher percentages than retail operations with inventory costs.

Question 3

Do I need two years of self-employment history?

Accepted Answer

Most lenders require 24 months in the same business or industry. Recent start-ups under 12 months won't qualify for bank statement programs.

Question 4

Will overdrafts or NSF fees hurt my approval?

Accepted Answer

Yes. More than two overdrafts in 12 months signals poor cash management. Clean up banking problems before applying or wait until statements show stability.

Question 5

Can I refinance with a bank statement loan?

Accepted Answer

Absolutely. Rate-and-term refinances work the same as purchases. Many Barstow borrowers refinance conventional loans into bank statement loans when they become self-employed.

Bank Statement Loans in Barstow — Income Verification for Self-Employed Borrowers