BANK STATEMENT ONLY MORTGAGE LENDERS – Explained
Bank Statement Mortgage Lenders offer a 12 or -Month Bank Statement Loan Program using bank statements ONLY to quality for a mortgage..
FOR YOUR FREE NO OBLIGATION CONSOLATION
12 or 24 Months Bank Statement Mortgage Lenders
12 or 24 Months Bank Statement Mortgage Lenders
What is a Bank Statement mortgage Lender?
Bank Statement Mortgage Lenders have taken over the traditional Bank Statement mortgage income loans as an alternative for self employed mortgage applicants who are unable to verify their income by providing the previous two years tax returns, W2s and pay stubs. These loans are called non-QM loans, nontraditional loans or expanded criteria loans that allow other forms of documentation to prove the ability to repay. Just as it sounds, a Bank Statement mortgage loan allows the borrower to verify his or her income with Bank Statement mortgages
Special Considerations By Bank Statement Mortgage Lenders
- You can use either business or personal no commingling.
- Use 12 months business bank account or personal account depending on the lender.
- Deposits which are transferred from a business account into a personal account are OK.
- You may combine W2 income with Bank Statement mortgage income as long as the income is not being counted twice.
- Foreign Bank Statement mortgages and Foreign Assets may be considered and must be translated to English.
The Bank Statement mortgage Loan Application Process
To apply for a Bank Statement mortgage loan you would fill out our full mortgage application. Then provide your last 12 or 24 months’ worth of Bank Statement mortgages from a personal or business bank account. Bank Statement mortgage loans are processed through a manual underwriting process. This means the income is calculated by a person so the process can take 24 -48 hours.
Eligible for a Bank Statement mortgage loan:
- You must prove self-employment for a minimum 2 years.
- Must provide proof of 12-month rental history or and 3-6 months future payments in reserves.
- You must have at least 10% down.
- You must have 4-6 months of PITI reserves
- You may qualify with as little as a 12-months Bank Statement mortgage.
- You must have a credit score of 600 or above to qualify.
- The minimum loan amount is $100,000, and the maximum loan is $5,000,000.
What Documents Do I need for a Bank Statement mortgage only Mortgage?
- Proof of income = Your most recent 12- or 24-months Bank Statement mortgages Business or Personal Bank Statement mortgages EVERY PAGE EVEN BLANKS in PDF labeled by month.
- PDF proof of down payment statement= 2 Months Bank Statement mortgages to source funds..
- Proof of 2 years in the same business or line of work = To include business licenses or satisfactory evidence of self-employed to cover previous 24 months that could include: Articles of incorporation, 2 years of 1099 s, Business license more than 2 years or accountant letter stating more than 2 years in the same business.
- Obligations = Divorce decree, Child support or court order required payment statements. Only if applies.
- ID = Driver’s license, SS Card.
- Mortgage Statements = For rental properties including taxes and insurance statements. Only if applies.
- W2 or 1099= If you have separate W2 or 1099 income you would like to use to qualify please provide.
- Purchase and Sale Contact. Only if you have one.
- Verified Timely Rent Payments- For Purchases Only – Please send front and backs of checks clearing your account or wire transfer’s for the most recent 12 months to verity timely rental payments.
What Are the Advantages of a Bank Statement mortgage Loan?
In summary, these are the advantages of a Bank Statement mortgage loan:
- The lender can look at 12 or 24-month Bank Statement mortgages.
- 30 Year Fixed Options.
- Bank Statement mortgage only mortgage lenders do not need to look at your tax returns.
- Your income statements are made up of the average monthly income deposits.
- You can get a Bank Statement mortgage home loan for as little as 10 percent down.
- You can do a cash-out refinance.
- You can borrow up to $5 million.
- Debt to income ratio up to 55 percent.
Eligibility Requirements for a Bank Statement mortgage Loan?
Eligibility for a Bank Statement mortgage requires total deposits minus disallowed deposits. This amount is then divided by the number of Bank Statement mortgages, whether it is the 12 or 24 months statement.
Another option is that if the co-borrower is a W2 employee you can use a hybrid of W2 and tax return income from the co-borrower and Bank Statement mortgage income from the borrower or assets from the co-borrower and Bank Statement mortgages from the borrower. Non-QM loans can use multiples sources of blended incomes to qualify.
Deposits which are disallowed in regards to a Bank Statement mortgage loan include transfers between bank accounts and cash or large deposits, which can raise a level of concern and may require a letter of explanation.
- Self Employed
o Must provide business license, Tax Preparer’s NOT Audited letter or corporate paperwork.
US Mortgage Lenders will accept Personal or Business Bank Statements. However, qualifying income will be calculated differently.
Personal Bank Statements: 100% of Deposits- Add all deposits for all 24 months and divide that amount by 24 to receive the monthly income amount we will apply as the borrower’s qualifying income.
Ex. 24 months deposits total = $200,000 / 24 = $8,333 a month income.
Business Bank Statements: 50% of Deposits- Add all deposits for all 24 months, divide by 2, and then divide by 24 to receive the monthly income amount we will give to the borrower.
Ex. 24 month deposit total = $500,000 / 2 = $250,000 / 24 = $10,333 a month income. * Only 50% is used because we have to assume the business has overhead.
Details of Bank Statement Only Lenders Program:
Personal & Business Guidelines
- Only deposits can be used Transfers are NOT counted on personal and case-by-case for business*
- Must have 24 consecutive months of statements (no gaps)
- Must provide All pages (even the last pages with advertising)
- Can not commingle (use two different accounts) statements**
- If account was used and closed and new account for remainder of statements must show closing of old account and opening of new account
bank Transfers may be accepted for business statements when they come from credit card clearing houses (examples: Paypal, Square, AMEX, etcetera). Case-by-Case and must be considered normal for the company.
Bank statement only borrowers may use multiple bank accounts are considered on a case-by-case when (a) one account is closing and reopening new account, or (b) for Business accounts that are two different and autonomous businesses.