Question 1

How recent must the P&L statement be?

Accepted Answer

Most lenders require P&L statements dated within 90 days of loan closing. Quarterly updates may be needed for longer escrows. Your CPA can prepare interim statements during the approval process.

Question 2

Can I use an in-house bookkeeper instead of a CPA?

Accepted Answer

No, lenders require licensed CPAs to prepare P&L statements for mortgage qualification. The CPA must be independent with current credentials. Bookkeeper-prepared statements don't meet underwriting standards.

Question 3

What if my business is less than two years old?

Accepted Answer

Some programs accept 12 months of operation with strong profit margins. Previous industry experience or substantial reserves can help. One-year-old businesses face tighter guidelines and higher down payments.

Question 4

Do lenders verify the income shown on my P&L?

Accepted Answer

Yes, underwriters verify business accounts, review bank statements, and may request additional documentation. The CPA letter adds credibility, but lenders conduct independent verification of business operations.

Question 5

How do P&L loans handle seasonal businesses?

Accepted Answer

Lenders typically average income across 12-24 months to smooth seasonality. Strong reserves and higher down payments help. CPAs should clearly explain seasonal patterns in their statements.

P&L Statement Loans for Portola Valley's Self-Employed Professionals