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in Simi Valley, CA
Self-employed borrowers in Simi Valley have two main options for proving income. Both bank statement loans and profit & loss statement loans serve entrepreneurs who can't provide traditional W-2 documentation.
These non-QM mortgages help business owners, freelancers, and contractors qualify for home loans. Each option uses different documents to verify your income. Understanding the differences helps you choose the right path for your situation.
Bank statement loans use 12 to 24 months of personal or business bank statements to verify income. Lenders review your deposits to calculate average monthly income. This option works well if you have consistent cash flow.
You don't need tax returns or CPA statements with this approach. The underwriter analyzes deposit patterns to determine how much you can borrow. Rates vary by borrower profile and market conditions.
Profit & loss statement loans require a CPA-prepared P&L to document your business income. Your accountant creates a detailed statement showing revenue and expenses. This provides a professional view of your earnings.
This option suits borrowers who already work with a CPA for their business. The P&L must be prepared by a licensed certified public accountant. Rates vary by borrower profile and market conditions.
The main difference is documentation type. Bank statement loans pull directly from your account history. Profit & loss loans need formal CPA preparation, which adds a professional layer to income verification.
Bank statement loans often process faster since you can download statements yourself. P&L loans require scheduling with your accountant and waiting for document preparation. Cost differs too, as CPA services add to your closing expenses.
Both serve self-employed borrowers in Simi Valley and Ventura County. Your choice depends on existing relationships with accountants and how you track income. Consider which documentation you already have or can easily obtain.
Choose bank statement loans if you want faster processing without CPA involvement. This works best when you have clean, consistent deposits. It's ideal if you don't currently use an accountant for your business.
Pick profit & loss statement loans if you already work with a CPA regularly. This option suits established businesses with formal accounting practices. It may provide better terms if your P&L shows strong profitability.
Both options serve Simi Valley self-employed borrowers effectively. Talk with a local mortgage broker about your specific situation. They can review your documents and recommend the best fit for your home purchase.
You typically choose one method or the other. Some lenders may review both, but the loan program focuses on either bank statements or P&L documentation as the primary income verification.
Rates vary by borrower profile and market conditions. Neither option automatically offers better rates. Your credit score, down payment, and overall financial picture matter more than the documentation type.
Bank statement loans often close faster since you can provide documents immediately. P&L loans take longer because you must wait for your CPA to prepare formal statements.
No, but lenders look for consistent deposit patterns. Large irregular deposits or frequent overdrafts may raise questions. Clean banking history helps but isn't required for approval.
Yes, both bank statement and P&L loans work for investment properties. You can use them for primary residences, second homes, or rental properties throughout Ventura County.