Bank Statement & 1099 Loans

These are alternative documentation loans, sometimes called Non-QM loans, designed for borrowers whose income is real but doesn’t fit the traditional W-2 mold. They’re not government-backed programs like FHA or VA. Instead, they’re portfolio and investor programs where the lender underwrites your actual cash flow rather than your adjusted gross income.

With a bank statement loan, we typically review 12 or 24 months of personal or business bank statements and calculate your qualifying income from your deposits. On business accounts, an expense factor is applied to account for the cost of running the business — often around 50%, though a lower factor may be used when a CPA or tax preparer provides a profit-and-loss statement supporting it. On personal accounts, a higher percentage of deposits can usually be counted.

With a 1099 loan, we use one or two years of your 1099 forms as the income documentation, applying a modest expense factor rather than requiring full tax returns. It’s often the simpler path for independent contractors whose income arrives from a handful of payers.

In both cases, no tax returns are required to qualify.

These loans were built for borrowers whose tax returns understate their income. That includes business owners and sole proprietors, real estate agents and brokers, contractors and tradespeople, consultants and freelancers, truck drivers and delivery drivers, rideshare and gig workers, medical and dental practice owners, restaurant and retail owners, and commission-only salespeople.

They’re also a fit for borrowers who have recently restructured a business, who have significant write-offs or depreciation, who have income from several sources that’s difficult to document conventionally, or who simply had a strong year that doesn’t yet show up on a completed return.

Bank statement and 1099 loans can be used to purchase a home or to refinance one, and they’re available on primary residences, second homes, and investment properties. If a lender has already told you no because of how you’re paid, this is often the conversation worth having next.

No tax returns, W-2s, or pay stubs required to document income.
12- or 24-month bank statement options using personal or business accounts, or a combination of both.
1099-only option for independent contractors, using one or two years of 1099s.
Income is calculated from deposits or 1099 totals, with an expense factor applied to business income.
Fixed and adjustable rate options available, with 30-year terms and interest-only structures on some programs.
Purchase or refinance, including cash-out to access equity in a home you already own.
Higher loan amounts available, well beyond conventional conforming limits on many programs.
Primary residences, second homes, and investment properties are all eligible.

Typically two years of self-employment or 1099 history — some programs allow one year for borrowers with prior experience in the same field.
Credit score — generally 620 and above, with better pricing and lower down payment options at higher scores.
Down payment — commonly starting around 10% to 20% depending on credit, occupancy, and loan amount.
Consistent deposit activity across the statement period, and business ownership verified through a license, CPA letter, or similar documentation.
Cash reserves — most programs require several months of payments in reserve after closing.
Debt-to-income ratio — generally up to roughly 50%, calculated on the income derived from your statements or 1099s.

REVIEWS

Customer Feedback

Brothers Financial would like to thank you for choosing us to take care of your mortgage needs. We understand the mortgage process can be very challenging, but our goal is to make it as easy as possible for you.

    
 
 
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   Rachel Eagleton 
 
 
 
 Trustindex verifies that the original source of the review is Google. Brian helped me get funding when I had been turned down by multiple other lenders due to being self-employed. The entire process was seamless and I am so grateful for his help. Thanks to him I get to make necessary repairs to my home and stay in it for years to come.
  
 
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   Aidan Tree 
 
 
 
 Trustindex verifies that the original source of the review is Google. Brody and Brian helped us so much in our home purchase every step of the way and made the process seamless and quick, and a at great rate!
  
 
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   Daphne Herrera 
 
 
 
 Trustindex verifies that the original source of the review is Google. Great experience! We’ve worked with Brian for about 7 years now. We live in Colorado and when Brian advised he was moving to TN, we were bummed. Thankfully, that doesn’t prevent us from doing business! This process was fairly streamline and fairly painless. Brian made sure to update us along the way and advise if there were additional documents needed. I definitely recommend using Brother’s Financial!!
  
 
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   Mary-Grace Griffin 
 
 
 
 Trustindex verifies that the original source of the review is Google. I highly recommend Brian Reid. He helped so much with the home buying experience. He was always willing to to answer questions and guide us through the process.
  
 
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   Ann Kömel 
 
 
 
 Trustindex verifies that the original source of the review is Google. Working with Brian made our home buying process much less stressful! His knowledge and expertise got us more favorable loan terms and interest rate. He was great to communicate with and very responsive as things change quickly. Can't recommend him enough!
  
 
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   Ayoka Moss 
 
 
 
 Trustindex verifies that the original source of the review is Google. Great time working with Brian on 4 refinances congruently!
  
 
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   Tammy Souther 
 
 
 
 Trustindex verifies that the original source of the review is Google. Brian and his team are fantastic! Highly recommend them for you home loan needs. Communicated well and made our process a breeze!
  
 
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   Nick Souther 
 
 
 
 Trustindex verifies that the original source of the review is Google. Amazing. Brian was amazing throughout the entire process. Very transparent, and involved with you as a client. He made a stressful experience ao much easier
  
 
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   Ginny Newman 
 
 
 
 Trustindex verifies that the original source of the review is Google. Brian was great to work with. He responded quickly and answered all our questions to help us understand and feel comfortable with the process.