Last Update: 11/05/2024
Bank Statement Business Description for Bank Statements + 1099 Only Programs
12 or 24 Most Recent Consecutive Monthly Bank Statements. Must verify all parties on bank account(s) will be on the Note, Otherwise an underwriter exception would be needed
1099 Only for primary or supplemental income Also Applies
Income and Employment Documentation
* Personal Bank Statements
When using Personal Bank Statements, most recent 3 Months consecutive Business Bank Statements will be needed to illustrate revenue flow.100% of Deposits Taken for Income – Must Evidence
Activity to Support Business Operations and Reflect Transfers to Personal Account. If Deposits Are Not Evidence of Business Account Transfers, or
* Business Bank Statements
Most Recent 12 or 24 Months of Business Bank Statements. Properly qualifying your bank statements and calculating your income. Liquid assets for reserves and TO supplemental income.
Rental Income: Schedule E or leases and bank statements showing rental income deposits
Verification of Employment Documents (VOE)
* Business Description Letter
* Letter of Explanation Summary Letter Business Overview (Template Loan Officer).
Borrower must supply a hand-written statement clearly describing the nature of the business and the income it generates, including an explanation of expenses and Expense Factor.
* SS89 completed by the borrower and wet-signed and dated
* CPA, Tax-Preparer, or Licensing Bureau Verifying 2-Year Self-Employment
* CPA or Tax-Preparer “Expense Ratio Letter” (when applicable)
Example: If Business Expense Statement Letter Indicates a 25% Expense Ratio, Then 75% of Net Qualified Deposits Will Be Used Towards Qualified Income
Business Must be in Existence for 2 Years, Verified Through CPA, Tax-Preparer, Licensing Bureau
Eligible Liquid Asset for Reserve Requirement(s):
* Checking, Savings, Money Market, COD showing source of down payment, closing costs, settlement costs, and reserves
* Cash Value Retirement Accounts,
* Cash Value Trust Fund Accounts
* Statements on Accounts Not Used for Income
Real Estate Owned (REO) Documents:
* Statements on all mortgages
* Homeowners Insurance Dec page (HOI)
* Homeowners Association Statement (HOA)
* Tax Statement (See Loan Officer)
* Purchase contract If purchase loan
* Recent Property Tax Bill
* Property Profile(s) if refinance
Loan Scenario Form – Credit Check Not Required
Available in the Following States:
Alabama, Arizona, California, Colorado, Florida, Georgia, Hawaii, Idaho, Illinois, Louisiana, Maine, Mississippi, Missouri, Nevada, New Jersey, North Carolina, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, and Wisconsin