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in Lathrop, CA
Both programs work for self-employed borrowers in Lathrop, but they verify income differently. Your choice depends on whether you want lenders to see your gross deposits or your net 1099 income.
Most self-employed buyers qualify better with one program over the other. The difference comes down to how your business expenses affect your taxable income versus your bank deposits.
1099 loans use your tax returns and 1099 forms to calculate income. Lenders look at what you actually reported to the IRS, which means business write-offs reduce your qualifying income.
You need two years of 1099 income history with consistent earnings. Credit scores start at 620, and down payments typically run 10-15% for Lathrop properties.
This program works if you don't take heavy business deductions. Borrowers with clean 1099 income and stable tax returns get conventional-style underwriting with non-QM flexibility.
Bank statement loans ignore your tax returns entirely. Lenders review 12-24 months of business or personal bank deposits to calculate income before expenses hit your bottom line.
You can qualify with just 12 months of bank statements if deposits are strong. Credit requirements start at 620, with 10-20% down depending on your credit profile and deposit consistency.
This program works best when you write off significant business expenses. Your gross deposits tell a better income story than your net taxable income on 1099 forms.
The core difference is gross versus net income calculation. Bank statement loans look at total deposits, while 1099 loans look at income after business write-offs reduce your taxable amount.
1099 loans require two years of consistent forms and tax filing history. Bank statement loans can work with just 12 months of deposits and no tax returns at all.
Both programs accept 620 credit scores and similar down payments for Lathrop buyers. Rates vary by borrower profile and market conditions, but bank statement loans typically cost slightly more due to reduced documentation.
Choose 1099 loans if your tax returns show strong net income without heavy deductions. This works for contractors who take standard write-offs and report solid taxable earnings to the IRS.
Choose bank statement loans if you write off substantial business expenses that crush your taxable income. Your deposits tell the real income story that 1099 forms hide after deductions.
Most self-employed Lathrop buyers qualify better under one program or the other by $100K+ in loan amount. Run both scenarios before deciding which documentation path makes sense for your purchase.
No, you pick one income verification method per loan. Some borrowers apply under both programs simultaneously to compare approval amounts.
Bank statement loans often close 3-5 days faster because they skip tax return verification. Both programs typically close in 25-30 days with complete documentation.
Yes, both work for Lathrop investment properties. Expect 20-25% down payments and slightly higher rates compared to primary residence financing.
You can combine income types. W-2 income follows standard verification while 1099 or bank statements document your self-employed earnings.
Bank statement loans handle seasonal deposits better by averaging 12-24 months. 1099 loans require consistent year-over-year income without major fluctuations.