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in Rio Vista, CA
Both 1099 loans and bank statement loans solve the same problem for Rio Vista self-employed buyers: proving income without W-2s. The difference is how lenders calculate what you can afford.
Most self-employed borrowers qualify for one program better than the other. Your business structure and how you handle expenses determine which path gets you approved.
We've closed both loan types in Solano County. The right choice depends on whether your 1099s show strong income or if your bank deposits tell a better story.
1099 loans use your contractor income statements to verify earnings. Lenders look at the gross income reported on your 1099 forms from the past two years.
This works best if you're a contractor with minimal business expenses. The lender qualifies you on the full 1099 amount, not your net after deductions.
You need consistent 1099 income from established clients. Most lenders want to see two years in the same line of work with stable or growing earnings.
Bank statement loans analyze 12 to 24 months of business or personal bank deposits. Lenders calculate your average monthly income from the deposits hitting your account.
This program works for any business structure - sole proprietors, LLCs, S-corps. It doesn't matter what your tax return shows if your bank statements prove cash flow.
The lender applies a percentage to your deposits to account for business expenses. That percentage varies from 50% to 100% depending on your industry and deposit patterns.
The biggest difference is income calculation. 1099 loans use your gross contractor earnings. Bank statement loans use a percentage of your deposits after accounting for estimated expenses.
Documentation requirements split differently too. 1099 loans need your contractor statements and proof of business continuity. Bank statement loans need consecutive months of statements with no gaps.
Rates vary by borrower profile and market conditions. Bank statement loans typically price slightly higher because they accept more complex income situations and varied business structures.
Choose 1099 loans if you're a contractor with clean income statements and low business expenses. This program qualifies you on higher income if your 1099s look strong.
Pick bank statement loans if you write off significant expenses, operate through an LLC, or your 1099 income varies by client. This program looks at actual cash flow instead of reported contractor income.
Most Rio Vista self-employed buyers qualify for both programs. We run scenarios through both to see which delivers better loan terms for your specific situation.
No. Lenders use one income documentation method per loan. We pick whichever program calculates higher qualifying income for your situation.
1099 loans typically price slightly better. Bank statement loans add rate because they accept more varied income documentation and business structures.
Yes. Both programs want two years in your current business or industry. Lenders need to see income stability over time.
Bank statement loans handle seasonal income better. They average 12-24 months of deposits, smoothing out the peaks and valleys in your cash flow.
Yes if documentation is clean. We've closed both programs in three weeks when borrowers provide statements upfront and underwriting finds no issues.