Bank Statement Loans for Business Owners

Bank Statement Loans for Self-Employed Borrowers

A Mortgage Option Designed Around Cash Flow — Not Tax Returns

If you’re self-employed, a business owner, or an independent contractor, qualifying for a mortgage can feel frustrating. You may have strong cash flow and consistent deposits, yet your tax returns don’t always reflect your true earning power.

That’s where bank statement loans come in.

A bank statement loan is a Non-QM (Non-Qualified Mortgage) program designed specifically for self-employed borrowers. Instead of using tax returns, this program allows borrowers to qualify based on actual deposits shown on personal or business bank statements, providing a more realistic picture of income.

What Is a Bank Statement Loan?

A bank statement loan allows eligible borrowers to qualify for a mortgage by analyzing 12–24 months of bank statements rather than traditional income documentation like W-2s or tax returns.

This approach recognizes a common reality for business owners:

• Tax strategies often reduce reported income
• Write-offs can make earnings look lower on paper
• Cash flow is often stronger than taxable income suggests

By focusing on deposits and consistency, bank statement loans better reflect earning potential and real-world income.

Who Are Bank Statement Loans Designed For?

Bank statement loans are ideal for:

• Self-employed borrowers
• Business owners
• Independent contractors
• Consultants and freelancers
• Real estate investors
• Gig-economy professionals

If you own 25% or more of a business or are paid outside of a traditional W-2 structure, this program may be a strong fit.

How Income Is Calculated

Instead of tax returns, lenders review:

• 12 or 24 months of bank statements
• Personal bank statements, business bank statements, or a combination
• Deposits are averaged to determine qualifying income
• Expense factors may be applied for business accounts

This method helps lenders assess ongoing cash flow and sustainability, not just what shows up on a tax return.

Key Benefits of Bank Statement Loans

✔ No tax returns required
✔ Reflects true cash flow
✔ Flexible income documentation
✔ Available for purchases and refinances
✔ Ideal for self-employed borrowers with strong deposits

What Makes This a Non-QM Loan?

Bank statement loans fall under the Non-QM category, meaning they don’t follow the strict income documentation rules of traditional conventional or government loans.

That doesn’t mean risky lending.

It means flexible underwriting designed for borrowers with solid finances who don’t fit into a standard box.

Non-QM loans:

• Still require full credit, asset, and appraisal review
• Are fully documented (just differently)
• Must demonstrate ability to repay

Common Questions About Bank Statement Loans

Do I need perfect credit?
No, but stronger credit helps improve terms and pricing.

Can I use business bank statements only?
Yes, many borrowers qualify using business statements, personal statements, or both.

Are bank statement loans only for buying a home?
No. They can be used for purchases, refinances, and sometimes cash-out refinances.

Do these loans have higher rates?
Rates are typically higher than traditional conventional loans, but often well worth it for borrowers who otherwise wouldn’t qualify.

Is a Bank Statement Loan Right for You?

If you’re self-employed and feel like your tax returns don’t tell the full story of your income, a bank statement loan may provide the flexibility you need.

Every scenario is different. The best first step is a personalized review of your bank statements and goals to determine whether this program—or another option—fits best.

👉 If you’d like help exploring bank statement loans or other self-employed mortgage options, I’m happy to walk through it with you.