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in Cloverdale, CA
Both loans are non-QM — meaning lenders skip the standard tax return income check. They exist specifically for self-employed borrowers.
In Cloverdale, many borrowers are contractors, vineyard operators, or freelancers. Neither W-2 nor traditional docs reflect their real income.
1099 loans use your 1099 forms — typically 1 to 2 years — to verify income. No bank statements needed.
This works best for single-client contractors or gig workers with clean 1099 income. Your gross earnings drive the qualification.
Bank statement loans use 12 to 24 months of deposits to calculate your income. Lenders apply an expense ratio to your deposits.
Business owners who run everything through a business account tend to qualify more easily. Personal accounts work too, with different ratios.
The core difference is the income document. 1099 loans need your earnings forms. Bank statement loans need your deposit history.
Write-offs hurt you differently on each. Heavy business deductions don't affect 1099 income calculations, but they can lower your deposit-based income on bank statement loans.
If you get paid by clients who issue 1099s, use that loan. It's cleaner and faster — one document type does the work.
If you own a business, mix income sources, or have spotty 1099 history, bank statements usually tell a better story. Rates vary by borrower profile and market conditions.
Some lenders allow hybrid documentation. Ask your broker which combination produces the highest qualifying income.
Non-QM loans typically require more down than conventional. Expect 10% to 20% depending on credit and loan size.
Both programs are similar. Most lenders want at least a 620 score, though better rates start at 680 or higher.
Yes. Both loan types can be used for primary homes and investment properties, though terms differ.
Non-QM loans can take a few days longer to underwrite. Having your documents organized speeds the process significantly.