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in Modesto, CA
Most Modesto self-employed buyers get turned down by conventional lenders. Not because they can't afford the payment — because their tax returns don't show enough income.
Two non-QM options exist for this exact problem: 1099 loans and bank statement loans. Picking the wrong one can cost you time and approval.
A 1099 loan uses your 1099 forms — not tax returns — to verify income. Lenders typically look at one to two years of 1099s and apply an expense factor.
This works best for independent contractors and freelancers with consistent 1099 income. Think gig workers, truckers, and consultants billing steady clients.
Bank statement loans use 12 or 24 months of deposits to calculate your income. Lenders ignore your tax write-offs and work from actual cash flow.
This is the go-to for business owners who run significant expenses through their accounts. High write-offs actually work in your favor here.
The core difference is how income gets calculated. 1099 loans start from your gross contract earnings. Bank statement loans start from your actual deposits.
If your deposits run higher than your 1099s show — or you mix personal and business income — bank statements often produce a stronger qualifying number.
Pick the 1099 loan if you're a pure contractor — one or two clients, consistent payments, minimal business expenses. It's simpler and often faster to document.
Go with bank statements if you own a business, write off aggressively, or deposit income that doesn't show clearly on any single 1099. Rates vary by borrower profile and market conditions.
Most lenders require you to pick one documentation method. We'll run the numbers both ways to see which gives you the higher qualifying income.
Non-QM loans typically require more down than conventional. Exact requirements depend on your credit, income strength, and the lender.
Not harder — just different. Your income type and expense level determine which program produces the stronger qualifying number.
Most non-QM lenders want at least a 620, though requirements vary. Higher scores improve your rate on both programs.
Yes. Gig workers with consistent 1099 income are a strong fit for the 1099 loan program. Steady deposit history helps the bank statement route too.
Non-QM loans can take 30 to 45 days depending on documentation. Having 24 months of clean records ready speeds things up significantly.