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in Escondido, CA
Self-employed borrowers in Escondido don't need tax returns to qualify for a mortgage. Both bank statement loans and P&L statement loans verify income differently than conventional loans.
The right choice depends on how you run your business books. A restaurant owner with heavy cash deposits uses a different strategy than a consultant with clean QuickBooks records.
Bank statement loans use 12 to 24 months of personal or business bank deposits to calculate income. Lenders add up deposits and apply a percentage (usually 50-75%) to determine qualifying income.
This works best for borrowers with consistent deposits but high write-offs on tax returns. You need minimal documentation beyond the statements themselves and a signed P&L in some cases.
Credit requirements start around 620, though 660+ gets better pricing. Down payments typically run 10-20% depending on the lender and your overall profile.
P&L statement loans require a CPA-prepared profit and loss statement covering 12-24 months. Some lenders also want a balance sheet and a CPA letter verifying your business exists.
This route suits borrowers with formal accounting systems already in place. If you're already paying a CPA for monthly or quarterly financials, you have what you need.
Credit and down payment requirements mirror bank statement loans. The difference is documentation complexity, not pricing or approval standards.
Bank statement loans look at actual cash flow through your accounts. P&L loans rely on accounting records your CPA prepares. The first is transactional proof, the second is prepared documentation.
Most Escondido self-employed buyers choose bank statements because they're faster and cheaper. You skip CPA fees for preparing formal financials if you don't already have them.
P&L loans make sense when your business already runs on accrual accounting or you have a CPA relationship. If you're paying for monthly financials anyway, use what you have.
Choose bank statements if you take business deductions that tank your tax return income. Cash-heavy businesses like contractors, restaurant owners, and retail operators fit this category perfectly.
Go with P&L if you already produce monthly or quarterly financials for your business. Tech consultants, professional services, and larger operations often have these ready to go.
Both options close loans in Escondido. Rates vary by borrower profile and market conditions, but pricing is nearly identical between the two programs when comparing similar scenarios.
Yes, most lenders accept business statements if your income flows through a business account. Some borrowers even combine personal and business statements to maximize qualifying income.
Your CPA must be licensed and in good standing. Most lenders verify the CPA license directly with the state board before accepting the prepared financials.
Bank statement loans typically close 3-5 days faster because you skip CPA preparation time. Both programs take 21-30 days total from application to funding.
Yes, you can pivot if one option doesn't work. We see this when bank deposits don't tell the full story or CPA financials take too long to prepare.
Down payment requirements are identical. Both programs start at 10% down for strong credit profiles and go up from there based on risk factors.