What Is a Bank Statement Mortgage?

For many self-employed individuals, securing a traditional mortgage can be challenging due to income verification requirements. A bank statement mortgage offers an alternative solution, allowing borrowers to qualify based on their bank statements rather than tax returns or W-2s. This type of loan is particularly beneficial for entrepreneurs, freelancers, and business owners in Florida who have strong cash flow but may not show consistent taxable income.

Self-Employed? Here’s a Smarter Way to Secure a Mortgage

A bank statement mortgage is a type of home loan designed for self-employed borrowers who may not have traditional proof of income. Instead of relying on tax returns, lenders assess the applicant’s financial health by reviewing 12 to 24 months of personal or business bank statements to determine income eligibility. This approach provides flexibility for individuals whose income fluctuates or is structured differently than salaried employees.

Key Features and Benefits

No Tax Returns Required – Borrowers qualify based on bank statements rather than traditional income documentation.
Flexible Loan Terms – Options include 30-year fixed rates, interest-only payments, and 40-year fixed terms.
Higher Loan Amounts – Loan amounts range from $250,000 to $5 million, making it suitable for various property types.

Primary, Second Home, and Investment Properties – Borrowers can use bank statement mortgages for different types of real estate purchases.
No Private Mortgage Insurance (PMI) – Unlike conventional loans, bank statement mortgages often do not require PMI, reducing monthly costs.

Who Qualifies for a Bank Statement Mortgage?

To be eligible for a bank statement mortgage in Florida, borrowers typically need:

A minimum credit score (varies by lender, but often 620 or higher).
At least 12 months of bank statements showing consistent deposits.
Proof of self-employment for at least two years.
A down payment (usually 10% to 20%, depending on the lender).

How to Apply for a Bank Statement Mortgage in Florida

Gather Your Bank Statements – Prepare 12 to 24 months of personal or business bank statements.
Check Your Credit Score – Ensure you meet the lender’s minimum credit requirements.
Find a Lender Specializing in Bank Statement Loans – Work with mortgage brokers or lenders experienced in non-traditional financing.
Submit Your Application – Provide necessary documentation, including proof of self-employment.
Get Pre-Approved – Receive an estimate of loan terms and interest rates before proceeding with the purchase.

Final Thoughts

A bank statement mortgage is an excellent option for self-employed individuals in Florida who struggle to qualify for traditional loans. By using bank statements instead of tax returns, borrowers can access flexible financing tailored to their unique financial situations. If you’re considering purchasing or refinancing a home, exploring bank statement mortgage options can help you achieve your homeownership goals.

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