Question 1

How recent does my P&L statement need to be for East Palo Alto mortgage approval?

Accepted Answer

Most lenders require a P&L statement covering the most recent 12-month period, prepared within 90 days of your application. Some programs accept year-to-date statements if you're applying mid-year.

Question 2

Can I use P&L loans for investment properties in San Mateo County?

Accepted Answer

Yes, many P&L statement loan programs work for investment properties and second homes. Investment property purchases may require larger down payments, typically 20-25% depending on the lender.

Question 3

What if my business shows lower income this year than last year?

Accepted Answer

Lenders typically average income across the P&L period or use the most recent 12 months. Significant income declines may require explanation letters from your CPA documenting temporary circumstances.

Question 4

Do P&L loans have higher interest rates than conventional mortgages?

Accepted Answer

Rates vary by borrower profile and market conditions. P&L loans often price 0.5-1.5% higher than conventional loans due to alternative documentation, though strong credit and down payments reduce this gap.

Question 5

Can I combine rental income with my P&L statement for qualification?

Accepted Answer

Yes, most lenders allow you to add rental income from investment properties to your self-employment income. The rental income requires documentation through leases and sometimes tax schedules.

Profit & Loss Statement Loans in East Palo Alto: Financing for Self-Employed Homebuyers