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Profit & Loss Statement Loans in Santa Cruz
Santa Cruz self-employed borrowers face a specific challenge. You run profitable businesses but show low taxable income.
P&L statement loans solve this by using your actual business revenue instead of tax returns. CPAs prepare the documentation lenders need.
This matters in Santa Cruz where many tech consultants, service providers, and creative professionals write off significant business expenses. Your tax strategy no longer blocks homeownership.
You need two years of self-employment in the same industry. Credit scores start at 660, though 700+ gets better pricing.
Your CPA prepares a year-to-date P&L showing business income. Lenders verify the CPA's license and calculate qualifying income from gross profit.
Down payments typically run 15-20% for primary homes. Loan amounts reach $3 million depending on your income documentation and reserves.
Most conventional lenders won't touch P&L loans. You need non-QM specialists who understand business income calculations.
Different lenders calculate qualifying income differently. Some use net profit only. Others allow add-backs for depreciation and one-time expenses.
SRK CAPITAL accesses 200+ wholesale lenders including P&L specialists. We shop your file to find who gives you the highest qualifying income and best rate.
Work with your CPA before applying. They need to format the P&L correctly and understand what lenders require for certification.
If your business is new or seasonal, bank statement loans often work better. P&L loans need consistent income over two years.
Rates run 1-2% higher than conventional loans. But that beats sitting out the market because your tax returns show $40k when you actually make $200k.
Keep six months reserves after closing. P&L lenders want to see you can weather business fluctuations.
Bank statement loans use 12-24 months of deposits instead of a P&L. They work when business and personal accounts mix or you lack a CPA.
1099 loans require contractor income documentation. They work for gig workers but miss business owners with expenses.
P&L loans make sense when you have clean accounting and a CPA relationship. Your business structure and record-keeping determine which program fits best.
Santa Cruz's tech-adjacent economy means many borrowers work as consultants or run small software companies. P&L loans fit this profile perfectly.
Properties near UC Santa Cruz or downtown see strong rental demand. If you're buying an investment property, DSCR loans often beat P&L loans because they ignore personal income entirely.
The coastal location matters for appraisals. Small income variations can affect loan amounts when properties cost $1 million plus. Maximizing your qualifying income through the right loan type makes deals work.
Your CPA needs an active state license. Lenders verify the license number and may contact them directly to confirm they prepared your P&L.
No. You need two years of self-employment in the same industry. New businesses should explore bank statement or asset depletion loans instead.
Most lenders allow depreciation and one-time expenses. Each lender has different add-back policies, which is why shopping multiple lenders matters.
Seasonal fluctuations hurt P&L loans because lenders average your income. Bank statement loans work better since they capture peak season deposits.
Rates vary by borrower profile and market conditions. Expect 1-2% above conventional rates with room for negotiation based on credit and down payment.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
Government-insured mortgages from the Federal Housing Administration with low down payments and flexible credit requirements.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.