Qualify using business or personal bank deposits instead of tax returns. Discover who qualifies, required documents, pros/considerations, and steps with New Wide Lending.
Hook
Write‑offs shrinking your taxable income? A Bank Statement Loan can show your real cash flow using 12–24 months of deposits instead of traditional tax returns.
How It Works
• Income Evaluation: Lenders total your eligible monthly deposits from personal and/or business accounts over a set period (often 12 or 24 months).
• Expense Factor: For business statements, an expense ratio may be applied to estimate net income (varies by lender and documentation type).
• Use Cases: Purchase, refinance, or cash‑out—especially when traditional W‑2/1040 documentation does not reflect your business reality.
Who It’s For
• Self‑employed owners, freelancers, contractors, and gig‑economy professionals.
• Borrowers with irregular income, multiple revenue streams, or significant write‑offs.
• Entrepreneurs with strong deposit history and responsible account management.
Documents You Will Likely Need
• 12–24 months consecutive bank statements (personal and/or business).
• Business license or CPA letter (varies), P&L, entity documents.
• Asset statements for reserves and a down payment source.
• Standard items include government ID, credit authorization, and a purchase contract (when applicable).
Pros & Considerations
Pros
• Reflects real‑world income when tax write‑offs are high.
• Flexible path to homeownership or equity access for entrepreneurs.
• Pairs well with purchase, rate-term refinance, or cash-out strategies.
Considerations
• Rates/terms and down‑payment requirements can differ from conventional.
• Expense factors reduce gross deposits to estimate income.
• Documentation must be complete, consistent, and verifiable.
6 Steps To A Stronger File
1) Account Audit — Choose the cleanest accounts with consistent deposits.
2) Timeframe — 12 vs 24 months: longer can smooth volatility.
3) Entity Hygiene — Align business name/EIN; limit commingling.
4) Seasonality Story — Explain big deposits or slow months in writing.
5) Reserves & Down Payment — Document sources clearly.
6) Compare Programs — Bank Statement vs 1099, P&L, WVOE, or DSCR (for investors).
FAQs
Q: Do I still need tax returns?
A: Often not for the income calculation in this program, though lenders may request them for background review.
Q: Can I use both personal and business statements?
A: Sometimes—guidelines vary. We will structure the strongest path for your profile.
Q: Can investors qualify?
A: Yes. For rental properties where property cash flow is the primary focus, consider DSCR (Debt Service Coverage Ratio) loans.
Cta
Ready to see what your deposits can do? Apply with New Wide Lending at /apply.
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Disclaimer:
Subject to credit approval. Not a commitment to lend. Programs, rates, and terms are subject to change without notice. Licensed in CA, TX, FL & GA. CalDRE #01928649 • NMLS #1339357. Equal Housing Lender.