Many Options To Choose From
Bank Statements For Income
What is a Bank Statement Loan?
A Bank Statement Loan is a flexible financing solution designed for self-employed individuals, small business owners, or borrowers who may not have traditional income verification like W-2s or tax returns. Instead, lenders use the borrower’s bank statements to assess their income and ability to repay the loan.
Key Features:
- Income Verification: Based on 12-24 months of personal or business bank statements.
- Loan Amounts: Typically range from $100,000 to $5,000,000 or more, depending on the lender.
- Credit Score Requirements: Usually starts at 600+, with better terms for higher scores.
- Down Payment: Often starts at 10%, depending on the borrower’s financial profile.
- Loan Terms: 15-30 year fixed or adjustable-rate options available.
Who Benefits from Bank Statement Loans?
- Self-Employed Individuals: Freelancers, consultants, and small business owners with non-traditional income.
- Business Owners: Those reinvesting in their businesses and unable to show high net income on tax returns.
- Commission-Based Workers: Realtors, sales professionals, or others earning variable income.
Cash Flow For Income On Rental Properties
What is a DSCR Loan?
A Debt Service Coverage Ratio (DSCR) Loan is a type of financing primarily used for investment properties. Instead of relying on personal income or tax returns to qualify, these loans are based on the property’s ability to generate enough rental income to cover the loan's debt obligations.
Key Features:
- Qualification Metric: The property’s DSCR is calculated as the ratio of its rental income to the loan’s total debt service (monthly principal, interest, taxes, and insurance payments).
- Loan Amounts: Typically range from $100,000 to $5,000,000 or more.
- DSCR Requirements: Most lenders require a DSCR of at least 1.0 (rental income equals debt service), though 1.2 or higher is preferred for better terms.
- Loan Terms: Fixed-rate and adjustable-rate options, often with 30-year terms.
- Down Payment: Usually starts at 20%-30% for purchase loans.
- Credit Score Requirements: Generally starts at 620+, with better terms for higher scores.
Who Benefits from DSCR Loans?
- Real Estate Investors: Individuals or companies looking to acquire, refinance, or cash out equity in income-producing properties.
- Portfolio Diversification: Investors aiming to expand their property portfolios without relying on personal income documentation.
- LLCs and Corporations: Business entities purchasing or holding investment properties
Profit and Loss Statement For Income
What is a Profit and Loss (P&L) Loan?
A Profit and Loss Loan is a loan designed for self-employed borrowers or business owners who may not have traditional income verification through W-2s or tax returns. Instead, these loans rely on the borrower’s Profit and Loss (P&L) statement to demonstrate income, typically accompanied by supporting business documents or bank statements.
Key Features:
- Income Verification: Based on a prepared P&L statement for 12-24 months, showing business revenues and expenses.
- Loan Amounts: Typically ranges from $100,000 to several million, depending on the lender.
- Credit Score Requirements: Often starts at 620+, with better rates for higher scores.
- Down Payment: Usually starts at 10%-20%, depending on loan size and borrower profile.
- Loan Terms: Fixed and adjustable-rate options, with terms of 15-30 years.
Who Benefits from P&L Loans?
- Self-Employed Individuals: Entrepreneurs, freelancers, or independent contractors with variable income.
- Small Business Owners: Those who reinvest profits back into their businesses and may not show high net income on tax returns.
- Business Expansion Seekers: Owners looking to finance growth or secure working capital.