Are you interested in buying a home, but are self-employed and concerned that you may not be able to get a mortgage because you are unable to provide certain tax and income verification? Even if you do not have traditional income documentation, you still could be able to secure a mortgage with a bank statement loan and purchase a new home. If you have a non-traditional source of income, and want to know more about your mortgage options in the areas of Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, contact Foundation Mortgage. We can help you determine the best financing option for your unique situation.
Bank Statement Loan Basics
Traditional loans typically require a borrower to provide W-2s, pay stubs, and tax returns to verify a borrower’s income and ensure that they will be able to repay the loan. Bank statement loans allow self-employed borrowers an alternative option to prove their income that does not require them to show their tax returns. A bank statement loan essentially allows eligible borrowers who are self-employed to use their personal banking information to prove their income, rather than using pay stubs and tax returns. A lender will use information from the bank statements to analyze a borrower’s income to verify that they can pay off the loan.
Borrowers who do not have a traditional income and those who are unable to get income documentation from an employer, such as business owners, consultants, freelancers, etc. could benefit from obtaining a bank statement loan. It is also an option for current homeowners to use a bank statement loan in order to refinance an existing mortgage. Some benefits of bank statement loans include: high loan limits, no required tax or income documentation, and high debt-to-income ratios are accepted.
Requirements For a Bank Statement Loan
In order to qualify for a bank statement loan, there are certain requirements that must be met, including:
- You must provide 12 consecutive months of bank statements from the same account
- You must prove a minimum of two years of self-employment
- There is a minimum loan amount of $100,000 and a max amount of $1,000,000
- You must have a maximum debt-to-income ratio, (DTI), of 45%
Learning More About Bank Statement Loans
If you are interested in buying a home, but are apprehensive because you are not sure you are able to provide the necessary documentation to obtain a mortgage, there may be other options available to you. If you are located in the areas of Knoxville, Maryville, Lenoir City, Oak Ridge, or Gatlinburg, Tennessee, Foundation Mortgage is here to help. We can work closely with you to determine the best home financing options for you and help determine if you qualify for a bank statement loan. Contact us today for a consultation.
