Bank statement loans in California permit individuals to be eligible for home loans with their bank statements of 12 months without providing a tax returns. This loan program has made it possible for residents in California to get mortgage loans with their bank statements which is between 12-24 months old.
We will guide you through everything you need to know about California bank statement loans. You can also become a homeowner with this form of loan.
How bank statements loans in California works
This type of loan make use of of borrowers bank statements; a business or a personal statement is good as long as you meet its requirement. Lenders use your bank statements to determine your creditworthiness in terms of repayment as they will be convinced you have a regular flow of income.
This is one of the best loan program for self-employed people who mostly do not qualify for personal loans. Have a business that provide you with a good income regularly and meet the bank statement requirements.
Lenders determine how much you can qualify for a mortgage loan identifying your qualified income. This is done by summing up your bank statement of 12 months and divide it by the 12 months which will give an approximate of your monthly income. You can get up to $3, 000,000 mortgage amount.
For example, the total amount of a borrower’s bank statement for 12 months is $300,000. This is how monthly income of the person is calculated.
$300,000 / 12 months = $25,000, which is the personal monthly income of the borrower.
Requirements
Qualifying for bank statement loans in California has to do with meet certain requirements provided by lenders. These lenders make their final decision based on how credible your information is before they approve. These requirements include;
- Providing a personal or business bank statement between 12-24 months
- 10% downpayment for buying and 90% LTV for refinancing.
- Tax returns is not required
- You must be self-employed for at least 2 years.
- 30-year fixed option.
- Must be a primary residence, investment property and second homes only.
- Up to 50% DTI.
- 3 months reserve.
- Retirement income
- Verified property.
- Minimum mortgage amount $2,000,000.
- Maximum mortgage amount $3,000,000.
In a situation where, a co-borrower or second borrower is added to your application, one of you must be self-employed for 2 years. The other person who isn’t self-employed must provide W2 and tax returns.
People with low credit score can for bank statement loans in California even with 500 score. The bank statement is used in place of a tax return when it comes to this form of loan.
