A Bank Statement Loan is a type of mortgage loan that is typically offered to self-employed individuals or business owners who may not have traditional documentation, such as pay stubs or W-2 forms, to show proof of income. Instead, these borrowers can use their bank statements to demonstrate their income and qualify for a mortgage loan.
The bank statements typically need to cover a specific period of time, such as 12 to 24 months, and show a consistent income stream. Interest rates on Bank Statement Loans may be higher than traditional mortgage loans and the down payment requirements may also be higher.
A Bank Statement Loan can be a good solution for self-employed borrowers who may not have traditional documentation, such as pay stubs or W-2 forms, to show proof of income. Self-employed borrowers often have irregular or fluctuating income, making qualifying for a traditional mortgage loan difficult.
With a Bank Statement Loan, the borrower can use their bank statements to demonstrate their income over a period of time, typically 12 to 24 months. This can be a helpful alternative for those with a consistent income stream but who don’t have the traditional documentation to prove it. However, it’s important to note that Bank Statement Loans may come with higher interest rates and down payment requirements than traditional mortgage loans.
In this recorded NASB webinar, Heather Howard explains how alternative forms of income verification can help self-employed borrowers secure a bank statement loan.
★★★★★ (5)
“My loan officer was always very quick to respond to my emails and phone calls. He was extremely knowledgeable and helpful. I sell for a builder here in Florida and NASB, and this type of loan, Bank Statement Loan, is now one I refer my clients to.”
