Bank Statement Loans Deliver Flexibility

Bank Statement Loans Offer Low Rates and a Simple Process for Self-Employed Borrowers in San Jacinto

Good news!  Even if you declare a loss on your federal income taxes, you may still be eligible for a mortgage loan. Our 12-month bank statement loan program at Modern Lending does not require any federal income tax returns as verification of income. Instead, we use your bank statements’ total deposit amounts from the previous year as evidence of your income. Private mortgage insurance (PMI) is not required under our Bank Statement Loan program, nor is there a maximum loan amount. Borrowers may submit applications for loans of up to $10,000,000. To qualify, though, a down payment of between 10% and 20% will be required. Your credit score determines the down payment and interest rate for your mortgage.

The Bank Statement Loan Process

Self-employed borrowers are only required to provide the following documents:

• 12-24 months of bank statements to provide proof of deposits
• Verification that your business has been in existence for at least 2 years

Don’t Let That Stop You From Applying For a Mortgage Loan

Watch this short video to find learn more about how Bank Statement Loans can benefit you. See why Modern Lending is closing 5 times more loans for self-employed homeowners in San Jacinto, CA.

Scenario examples of potential borrowers in San Jacinto

Scenario # 1: A husband or wife is self-employed and their spouse is a w2 employee

• The self-employed borrower must provide 12 to 24 months of bank statements from their personal or business accounts (the account where business revenue is being deposited)
• The W2 employee borrower must provide 2 years of W2s and the two most recent pay stubs
• A borrower that owns 100% of their business will have their income calculated by adding up all of the customer deposits for the last 12 or 24 months and then reducing that amount by 30% – 50% to determine the qualifying income that can be used for a mortgage loan.
• The bank statements of the borrower must show income with a consistent flow to prove they are dependably earning money (cannot be just one or two large deposits for the year)
• The income for the self-employed borrower and the W2 salary borrower gets combined to determine the total qualifying income.

Scenario #2 Both borrowers are self-employed for at least two years in separate businesses

• Each self-employed borrower must provide 12 to 24 months of bank statements from their personal or business accounts (the account where business revenue is being deposited)
• For borrowers that own 100% of their business, the income for the self-employed borrowers gets calculated by adding up all of the customer deposits for the last 12 or 24 months and then reducing that amount by 30% – 75% to determine the qualifying income that can be used for a mortgage loan.
• For borrowers that only own 50% of the business, the income amount gets determined using the model above and is then divided in half. 
  • Example: A business deposits $200,000 over the last 12 months.  The owner owns 50% of a consulting business.  70% of $200,000 is $140,000 (this is the income that could be used IF he/she owned 100% of the business. This amount is then reduced by 50% so only $70,000 can be used.

• The bank statements of the borrower must show income with a consistent flow to prove they are dependably earning money (cannot be just one or two large deposits for the year)

• The exact process is repeated for the other self-employed borrower. Then the results of each income calculation are added together to determine the qualifying income for both borrowers.