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in Buellton, CA
Most Buellton buyers with self-employment income get rejected by conventional lenders. That's where non-QM loans step in.
Both 1099 loans and bank statement loans bypass W-2 requirements. But they're built for different income situations.
1099 loans are built for independent contractors and freelancers. Lenders use your 1099 forms to verify income — not your tax returns.
This matters because many contractors write off heavy expenses. Tax returns show low net income. Your 1099s show what you actually earned.
Bank statement loans use 12 to 24 months of deposits to calculate your income. Lenders apply an expense ratio and lend against the rest.
This works well for business owners who mix personal and business income. It also covers borrowers who don't issue or receive 1099s.
The core difference is how income gets calculated. 1099 loans use gross 1099 earnings. Bank statement loans use average monthly deposits minus an expense factor.
1099 loans are narrower — you must have 1099 income specifically. Bank statement loans accept a wider range of self-employed borrowers.
If you're a freelancer or contractor with strong 1099 income and big write-offs, the 1099 loan usually qualifies you for more.
If you run a business, get paid in mixed ways, or can't show clean 1099 history, bank statements are the stronger path.
Some non-QM lenders allow combined documentation. Ask your broker which approach produces the higher qualifying income for your file.
Yes. Both loan types work for purchases and refinances in Santa Barbara County. Property type and loan amount affect eligibility.
Most non-QM lenders want at least a 620. Better scores get better pricing — rates vary by borrower profile and market conditions.
Non-QM loans can go into jumbo territory. Your qualifying income and debt-to-income ratio set the ceiling, not a fixed program limit.
They carry higher rates and stricter equity requirements. They're not riskier for borrowers who understand the terms upfront.
Typically 21 to 30 days with complete documentation. Incomplete files are the most common cause of delays on non-QM deals.