What Is a Bank Statement Loan in Texas?
Quick Answer: A bank statement loan is a home loan for self-employed buyers that uses the deposits in your bank accounts, often from the last 12 to 24 months, instead of your tax returns to show income. It can help when write-offs make your tax return look lower than what you really earn. Terms often differ from a standard loan.
Why do self-employed buyers get stuck?
Business owners write off expenses to lower their taxes. That's smart. But lenders often use the income after write-offs, so a salon owner or a truck owner-operator can look like they earn much less than they do.
How does a bank statement loan work?
Instead of your tax return, the lender reviews your bank statements over a set period, often 12 to 24 months. They look at your deposits and use a method to figure your income from them. Rules vary by program.
What do I need to have ready?
Personal and business bank statements for the period
Proof you've been self-employed for a while, like a business license or a CPA letter
Your credit report
A list of your monthly debts
What's the catch?
These loans are a different type from a standard loan. The terms, like the rate and the down payment, are often different. That's why it's worth comparing a bank statement loan and a standard loan side by side with your real numbers.
Who should look at this?
Self-employed buyers whose tax returns don't show their real income. If your returns do show enough, a standard loan may still be the better fit.
What's the first step?
Pull your last 12 months of bank statements. Then let's look at both options together.
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Frequently Asked Questions
What is a bank statement loan?
It's a home loan for self-employed buyers that uses your bank deposits, often from the last 12 to 24 months, to show income instead of your tax returns. Rules vary by program.
Who is a bank statement loan for?
Self-employed buyers whose tax returns show less income than they really earn because of write-offs. Business owners and independent contractors often look at this option.
Are bank statement loans more expensive?
The terms, like the rate and down payment, are often different from a standard loan. Compare both side by side with your real numbers before you choose.
Ai Tran, Realtor and Loan Officer
2020 Realty
Round Rock, TX
512-300-8611
https://www.AiTTran.com
Ai Tran (Ái)
Loan Officer tại Round Rock, Texas hỗ trợ người mua nhà
https://www.loanfactory.com/aitran
512-300-8611
Loan Factory | NMLS #320841
Ai Tran | NMLS # 2627075
NMLS Consumer Access
About the author: Ai Tran is a bilingual Realtor and loan officer based in Round Rock, TX, serving Round Rock, Austin, Pflugerville, Leander, and Cedar Park. Through her One Desk Method she handles both the home and the loan, so families get the right house and the right financing from one person they trust. NMLS #2627075.
Equal Housing Lender. Ai Tran NMLS #2627075, Loan Factory NMLS #320841. Not a commitment to lend. Rates, products, and fees subject to change; subject to underwriting approval; not all applicants qualify. Loans offered in TX and CA only. Disclosures: https://www.loanfactory.com/aitran/disclosure
