Bank Statement Loans
For self-employed individuals and business professionals, traditional mortgage loans often present significant challenges. Conforming loans typically require extensive documentation of income, which might not accurately reflect the financial reality of entrepreneurs. This is where 12-24 months bank statement mortgage loans come into play, offering a tailored solution for those with non-traditional income streams. Instead of relying on W-2 forms or tax returns, Bank Statement loans use personal or business bank statements from the past 12 to 24 months to verify income and determine loan eligibility.
Firstly, Bank Statement loans provide greater flexibility in income verification, recognizing the unique financial situations of entrepreneurs. Secondly, they often enable borrowers to qualify for higher loan amounts, as the income assessment is based on actual deposits rather than taxable income. Lastly, this type of loan can expedite the approval process, making it easier and faster to secure financing.
To qualify for a 12-24 months bank statement mortgage loan, applicants typically need to demonstrate a stable and sufficient cash flow through their bank statements. Lenders will review the average monthly deposits over the selected period to gauge financial stability. Additionally, having a good credit score and a reasonable debt-to-income ratio can improve the chances.
Bank Statement Loans - What You Need to Know
As a non-conforming mortgage loan broker and commercial bridge lender, Franklin Mortgage Holdings understands that property ownership and business success depend on access to flexible funding sources. That’s why we offer Bank Statement Loans, a financing solution tailored to self-employed borrowers and investors who cannot qualify for traditional loans based on income documentation or credit scores.
What Are Bank Statement Loans?
Bank Statement Loans are a type of loan that allows borrowers to use their personal or business bank statements to qualify for a mortgage. The loan is based on the income deposited into the borrower’s bank account over the past 12 or 24 months, depending on the lender’s policy. Bank Statement Loans are also known as alternative income loans or non-QM loans because they do not require the traditional income verification process.
How Do Bank Statement Loans Work?
Bank Statement Loans work by using the borrower’s bank statements as proof of income. The lender will require the borrower to provide 12 or 24 months of bank statements so they can calculate an average monthly income. The lender will then use this income to calculate how much the borrower can afford to pay in monthly mortgage payments. Bank Statement Loans come with a slightly higher interest rate compared to traditional loans, but the benefit is that borrowers who may not qualify for a traditional loan are eligible for financing.
Who Can Benefit from Bank Statement Loans?
Self-employed individuals and small business owners who have a hard time providing the necessary documentation to qualify for traditional loans can benefit from Bank Statement Loans. Foreign nationals who do not have a credit history in the US can also benefit from Bank Statement Loans. These types of loans can also be helpful if you have high debt-to-income ratios.
What Are the Benefits of Bank Statement Loans?
- No income verification required
- Lower down payment requirements compared to traditional loans
- Flexible credit score requirements
- Quick approval and funding process
What Are the Requirements for Bank Statement Loans?
The requirements for Bank Statement Loans depend on the lender. Typically, lenders will look for the following:
- 12 or 24 months of personal or business bank statements
- Good credit score
- No recent bankruptcies or foreclosures
- Sufficient cash reserves
- High enough monthly bank deposits to cover monthly mortgage payments
How to Apply for Bank Statement Loans?
At Franklin Mortgage Holdings, we have simplified the Bank Statement Loans application process. Here’s what you need to do:
- Fill out our online application.
- Provide your bank statements.
- Wait for our loan officers to assess your application.
- Receive our loan offer.
- Close your loan.
What Can You Expect from Franklin Mortgage Holdings?
At Franklin Mortgage Holdings, you can expect personalized service from our experienced loan officers. We take the time to understand your unique financial situation and offer a customized financing solution that meets your needs. We also offer competitive rates and fast approvals to help you finance your dream home or investment property.
If you’re a self-employed borrower looking for a flexible financing option, Bank Statement Loans may be the solution for you. At Franklin Mortgage Holdings, we specialize in providing alternative income loans tailored to your needs. Apply online today and let us help you finance your dream property.