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in San Diego, CA
San Diego's self-employed borrowers have two main paths to mortgage approval without tax returns. Bank statement loans use deposits to calculate income. P&L loans rely on CPA-prepared financial statements.
Both options serve the same borrower type but with different documentation burdens. Your choice depends on how you run your books and what your CPA already prepares.
Bank statement loans calculate your income by analyzing 12 to 24 months of business or personal deposits. Lenders apply an expense factor—typically 25% to 50%—to account for business costs. The remaining amount becomes your qualifying income.
You'll need consistent deposits and clean bank records. Most lenders accept business accounts, personal accounts, or both. No CPA requirement, but higher deposits mean stronger approval odds.
P&L loans require a CPA-prepared profit and loss statement covering 12 to 24 months. Your accountant certifies the income, and lenders use that figure for qualifying. You'll also provide business bank statements to support the P&L numbers.
This route works best if your CPA already tracks detailed financials. The P&L shows net profit after expenses, so your qualifying income is cleaner and often higher than bank statement calculations.
Bank statement loans let you skip the CPA entirely—lenders do the income math themselves. P&L loans need professional preparation, which costs money but often yields higher qualifying income since your accountant optimizes expense reporting.
Bank statement loans work faster if your deposits are straightforward. P&L loans take longer because your CPA must prepare and sign the statement. Rates vary by borrower profile and market conditions, but approval requirements are similar for both programs.
Choose bank statement loans if you want speed and simplicity. Your deposits tell the story without paying for CPA work. This works well for contractors, consultants, and small business owners with clean banking habits.
Pick P&L loans if your CPA already prepares detailed financials and your business has complex expenses. The certified statement often qualifies you for a larger loan amount, especially if bank deposits don't capture your full earning power.
No. Lenders pick one income verification method per loan. You'll submit bank statements to support a P&L loan, but the P&L drives qualification.
Rates vary by borrower profile and market conditions, not documentation type. Credit score, down payment, and loan amount matter more than whether you use bank statements or P&L.
You need a licensed CPA or certified public accountant. Bookkeepers and unlicensed accountants don't meet lender requirements for P&L statement loans.
Most lenders require 12 to 24 months of statements. Longer history strengthens your application, especially if income fluctuates between months.
Yes, but it restarts underwriting. Your loan officer will need new documentation and the approval timeline resets from that point.