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in San Francisco, CA
San Francisco runs on self-employed income. Consultants, freelancers, and gig workers dominate the workforce here.
Two non-QM loans serve this group: 1099 loans and bank statement loans. Each verifies income differently. The right one depends on how you get paid.
A 1099 loan uses your 1099 forms to verify income. Lenders typically look at one to two years of 1099s.
This works best for contractors with consistent clients. Your income shows clearly on the forms — no bank statement math required.
Bank statement loans use 12 to 24 months of deposits to calculate your income. Lenders apply an expense ratio to your gross deposits.
This fits business owners and freelancers who write off heavy expenses. Your tax returns may show low income — your deposits tell a different story.
Local decision guide
Use this comparison to weigh 1099 Loans and Bank Statement Loans through local payment fit, eligibility, documentation, and timing before choosing a path in San Francisco.
San Francisco runs on self-employed income. Consultants, freelancers, and gig workers dominate the workforce here.
Two non-QM loans serve this group: 1099 loans and bank statement loans. Each verifies income differently. The right one depends on how you get paid.
A 1099 loan uses your 1099 forms to verify income. Lenders typically look at one to two years of 1099s.
The core difference is documentation. 1099 loans read your earnings directly from IRS forms. Bank statement loans calculate income from raw deposit history.
Bank statement loans carry more underwriter discretion. Expense ratios vary by lender. Rates on both products run higher than conventional loans. Rates vary by borrower profile and market conditions.
If you work as a freelancer or contractor with clear 1099 income and few write-offs, the 1099 loan is simpler. Less paperwork, more straightforward approval.
If you own a business and your tax returns understate your real earnings, bank statements make the stronger case. SF's high purchase prices make maximizing your qualifying income critical.
Some lenders allow hybrid documentation. Most require you to pick one method. A broker can identify which lenders allow blended income.
Both are non-QM, but credit minimums vary by lender. Most require at least a 620-660 score. Higher scores improve your rate significantly.
Non-QM rates run higher than conventional rates. The gap depends on your credit, down payment, and loan size. Rates vary by borrower profile and market conditions.
Yes. Non-QM lenders often go well above conforming limits. That matters in SF where prices regularly exceed conventional loan caps.
Most non-QM lenders want 10-20% down. Stronger credit and reserves can sometimes reduce that requirement. It depends on the lender.
Yes. 1099 loans read income from your tax forms. Bank statement loans calculate income from deposits, then subtract an expense ratio.