Question 1

Does my CPA need to be licensed in California?

Accepted Answer

Most lenders require a CPA licensed in the state where the business operates. For Santa Rosa borrowers, that means a California-licensed CPA.

Question 2

Can I use a 12-month P&L instead of 24 months?

Accepted Answer

Some lenders accept 12-month P&Ls, but 24 months usually gets you better terms. A shorter history can trigger higher rates or larger down payment requirements.

Question 3

What if my P&L shows a net loss in one year?

Accepted Answer

A single year of losses typically disqualifies you with most P&L lenders. Consistent profitability over 12-24 months is what underwriters want to see.

Question 4

How is income calculated from a P&L statement?

Accepted Answer

Lenders typically use net income after expenses. Some add back depreciation. Each lender has its own formula — this is where shopping lenders pays off.

Question 5

Are P&L loans available for investment properties in Santa Rosa?

Accepted Answer

Yes, but expect stricter terms. Investment property P&L loans often require larger down payments and stronger credit compared to primary residence files.

Question 6

Do P&L loans have higher rates than conventional loans?

Accepted Answer

Yes. Non-QM products carry more risk for lenders, and that's priced in. Rates vary by borrower profile and market conditions.

P&L Statement Loans for Self-Employed Buyers in Santa Rosa