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in Mount Shasta, CA
Mount Shasta's economy runs on independent workers — outdoor guides, wellness practitioners, remote consultants, and seasonal business owners. Traditional W-2 income verification doesn't fit how most people here earn money.
Both 1099 loans and bank statement loans solve the self-employment problem. They just verify your income differently. Which one works depends on how your business is structured and what your tax returns show.
1099 loans use your 1099 forms to prove income. Lenders look at the gross amount on your 1099s, not what you report after deductions. This works if you receive 1099-NEC or 1099-MISC forms from clients.
Most programs require two years of 1099 income from the same line of work. Credit minimums start at 620. Down payments typically run 10-20% depending on your income documentation and property type.
This loan makes sense if you're a true independent contractor. Your clients send you 1099s. You don't own a formal business entity like an LLC or S-corp.
Bank statement loans skip tax returns entirely. Lenders pull 12 or 24 months of bank statements and calculate income from your deposits. They typically use 50% of deposits for sole proprietors, assuming half covers expenses.
This program works for any self-employed structure — sole proprietor, LLC, S-corp, partnership. Credit requirements start around 620. Down payments range from 10-20%, sometimes higher for newer businesses.
Bank statement loans help borrowers who write off significant expenses. If your tax returns show low net income but your bank account tells a different story, this is your path.
The documentation split is straightforward. 1099 loans need your 1099 forms. Bank statement loans need your bank statements. But the real difference is which one shows higher qualifying income for your situation.
If you're an independent contractor with minimal business expenses, 1099 loans often qualify you for more. Your gross 1099 income counts. If you run an actual business with significant overhead and write-offs, bank statements usually work better.
Processing speed varies by lender, but bank statement loans typically take longer. Underwriters manually review every deposit. 1099 loans move faster because the income calculation is simpler. Rates are similar — both price as non-QM products.
Choose 1099 loans if you receive 1099 forms and your income is consistent. This works for consultants, contract nurses, freelance designers, or anyone whose clients report payments. You need steady 1099 income from the same type of work.
Bank statement loans fit business owners and self-employed borrowers with complex finances. If you own an LLC, take distributions from an S-corp, or your tax returns look terrible because of depreciation and write-offs, use bank statements.
Mount Shasta's real estate moves fast when properties hit the market. Know which documentation path fits your income before you start shopping. Pull your 1099s or bank statements now and talk to a broker about qualifying amounts.
Yes. Lenders can combine 1099 and W-2 income as long as your 1099 work has at least two years of history. The W-2 portion follows standard documentation.
Both work. Personal accounts are simpler because all deposits count. Business accounts require lenders to identify business vs personal deposits, which adds review time.
Rates are similar since both are non-QM products. Your credit score, down payment, and debt-to-income ratio affect rates more than which program you choose.
Most lenders require two years of 1099 income in the same line of work. Some allow one year if your income is strong and stable.
Yes, but it restarts underwriting. Smart move: run numbers for both options before applying. Choose the one that qualifies you for the amount you need.