Question 1

Can I use a bookkeeper instead of a CPA to prepare my P&L?

Accepted Answer

No. Lenders require a licensed CPA to prepare and sign your profit and loss statement. Bookkeeper-prepared financials get rejected during underwriting.

Question 2

What if my P&L shows higher income than my tax returns?

Accepted Answer

Your CPA must write a letter explaining the variance. Lenders accept differences caused by timing, accrual accounting, or non-deductible expenses shown on your P&L.

Question 3

Do I need two years of P&L statements or just one?

Accepted Answer

Most lenders require 12-24 months. Two years of consistent profit strengthens your application and often lowers your rate. Some lenders accept just 12 months with strong credit.

Question 4

How do lenders calculate my qualifying income from a P&L?

Accepted Answer

They average your net profit over 12 or 24 months. Some lenders add back depreciation and one-time expenses. Your broker can estimate qualifying income before you apply.

Question 5

Can I buy a Grover Beach home with 10% down using a P&L loan?

Accepted Answer

Yes, if your credit exceeds 700 and the loan amount stays under certain thresholds. Higher loan amounts typically require 15-20% down on P&L programs.

P&L Statement Loans for Self-Employed Borrowers in Grover Beach