ServicesBank Statement Loans
Bank Statement Loans in Hutto
If you work for yourself, write-offs can make your tax return look smaller than your business really is. We qualify you on the deposits that land in your account, show you every figure we used, and give you a straight answer on how much home loan you can carry.
A home loan built on deposits, not tax returns
A standard lender asks for two years of tax returns and counts the bottom line. For someone on salary, that is fair. For a contractor, a salon owner or a consultant, the bottom line comes after trucks, equipment and office costs are taken off. Those deductions save you tax money, but they also cut the income an underwriter is allowed to use.
With this loan, we figure your income from your account history instead, using either the last 12 or the last 24 months. Personal or business accounts can work. Business accounts usually have an expense percentage taken off, so each deposit does not count in full. Because these loans fall outside the standard agency guidelines, the income rules are looser, but plan on a higher rate and more money down than a conventional loan.
Our NMLS license goes back 10 years, and we meet at our office or over phone and video. If it turns out your returns qualify after all, we will tell you and steer you to Conventional Loans.
What we do on a bank statement loan
- Statement review, line by line
- We read every month you send. We mark which deposits count as income and which do not, like transfers between your own accounts or a one-time loan payout.
- An income worksheet you can see
- You get a copy of the math. It shows the monthly deposits, the expense factor if one applies, and the average we landed on. Nothing happens behind a curtain.
- Personal vs. business account choice
- Some borrowers do better on personal statements, some on business. We run it both ways when you have both and show you the difference.
- Pre-approval you can shop with
- Once the income holds up, we write a pre-approval your agent can hand to a seller. It is based on documents, not a guess.
- Rate and down payment options
- We lay out a few combinations of down payment and rate side by side, so you can pick what fits your cash flow.
Signs a bank statement loan fits you
Write-offs shrink your paper income
Business is good. But once deductions come off, the number on your return is small, and a lender who reads only that line sizes you too low.
Another lender said no
You heard your income was too low or too uneven to count. Often that lender looked at your Schedule C or K-1 and stopped there.
You get paid in lumps
Money arrives by the job, the season or the contract. Averaging 12 or 24 months of deposits evens out the high and low months.
Your business is fairly new
Some programs accept a shorter track record when deposits are steady. If your history is too short, we say so on the first call.
Several income streams
1099 work, a business account, maybe a side job too. We sort out which deposits we can count and show you the list.
What sets your rate and closing costs
Expect a higher rate here than on a conventional home loan, since the lender is counting income without leaning on tax returns. How big the gap is depends on your file. These are the things that move it most.
Money down
A larger down payment means less risk for the lender. In many files it moves the rate more than anything else.
Credit score
Higher scores land in better pricing tiers. One recent late payment can bump you down a tier.
Length of the statement review
Some programs give better pricing on a 24-month review. Others let one strong recent year carry the file on 12 months.
Reserves left after closing
Cash still in the bank after you sign shows you can handle a slow stretch. Bigger reserves can help your terms.
How you will use the property
Living in it, keeping it as a second place, or renting it out each get priced on their own terms. Rentals usually cost the most.
How it goes, start to closing
- 1
First call
We ask about your business, how long you have run it and how you get paid. That tells us whether 12 or 24 months of statements makes more sense.
- 2
Send your statements
You send the full statements, every page. We go through them and flag anything that needs a short explanation, like a large deposit.
- 3
Review the worksheet together
We walk you through the income figure we came up with and the reasons behind each adjustment. You see what we found before anything goes to underwriting.
- 4
Pre-approval and offer
With the numbers settled, you get a pre-approval and start shopping in Hutto, Round Rock or wherever you are buying.
- 5
Underwriting to closing
We keep you posted on each condition the underwriter asks for, and you get a copy of what we sent. Then you sign at closing.
Bank statement loan questions
Do I need to send tax returns at all?
Usually not for income. The point of this loan is to qualify on deposits. You may still need a business license, a CPA letter or other proof that you have been self-employed for the required time.
Should I use personal or business statements?
It depends on how your money flows. Business statements often get an expense factor taken off, while personal statements may count deposits more fully. We run both when you have them and show you which comes out ahead.
How much do I need for a down payment?
These loans generally ask for more down than a conventional or FHA loan. The exact amount depends on your credit, the property and the program. We will give you real figures once we see your file.
Can I refinance into a bank statement loan later?
Yes, if you already own and your returns made a standard refinance hard, a bank statement refinance can work. Some borrowers also go the other way and move to a conventional refinance once their returns catch up.
What if I have a big deposit I can't easily explain?
Tell us early. Large one-time deposits get questioned and may be left out of your income. We would rather know up front than have it surface in underwriting.
Find out what your deposits support
Have a rough idea of your monthly deposits and how long you have been self-employed. We will tell you where you stand and what comes next.