12/24 Month Bank Statement

A Bank Statement Loan is a home loan program designed for self-employed/ business owners. For qualification purposes, the lender uses the deposits made into the business owner’s account as the source of income, instead of using the applicant’s tax returns.

A Bank Statement Loan’s benefits in 2026:

1. No tax returns required
2. 12 or 24 months of bank statements
3. Personal, business, or combined statements accepted
4. Loan amounts up to $4 million
5. Up to 90% CLTV on purchase
6. Concierge income calculation support

Yes. Eligible occupancy types include primary residence, second home, and investment property.

Here are key requirements of AD Mortgage’s 12/24 Month Bank Statement Loan:

• 12 or 24 months of bank statements (personal, business, or combined)
• Min. FICO 620 or no score
• Up to 90% CLTV purchase / up to 80% CLTV cash-out
• Up to 55% DTI on owner-occupied
• Up to $4M Loan amount for purchase / up to $3M Loan amount for cash-out
• Minimum 3 months of reserves
• 25% business ownership

A Bank Statement Loan is not a subprime loan. Instead, it is a secondary market program for Non-QM loans that uses alternative ways to qualify the applicant’s income. Many Non-QM programs, like a Bank Statement Loan for self-employed and business owners, are designed around the lending needs of a certain market segment.

The primary difference between a 12/24 month Bank Statement Loan and a traditional one is that in the former case the applicant qualifies based on the deposit income in the bank statement, rather than the applicant’s tax returns.

A borrower has to be in business at least for 12 months to qualify for a Bank Statement Loan for self-employed.

If their ordinary business income is deposited into a personal account, applicants can use a personal bank statement. Keep in mind, that this may potentially complicate the approval process if they share this account with another person, such as a spouse who has a job. If they are a 1099 wage-earner and depositing their income into a personal account, we suggest using our 1099 income program.

Yes. If borrowers are qualifying for a Bank Statement Loan in 2026, they may be asked to provide a letter from a licensed tax preparer. On a Bank Statement Loan, we don’t review tax returns, so we rely on third parties such as a licensed tax professional to verify certain aspects of their business.

Here are some examples of the things commonly requested:

• Verify the business’s expense ratio (%)
• Verify the length of time the business has been operational.
• Verify the ownership percentage of the business

No. For a Bank Statement Loan, the letter can come from any licensed tax preparer, accountant, or CPA. It must appear on their letterhead, be signed and dated. We need to be able to verify the tax professional’s Preparer Tax Identification Number (PTIN) or CPA license number.

YES. The letter being provided relies on third-party information provided by a licensed tax professional and is not expected to directly match the information seen in the tax returns. Unlike a traditional home loan program, on a Bank Statement Home mortgage for self-employed, the lender does NOT pull a tax return transcript of the applicant’s personal or business returns from the IRS.

They can but it would be much easier using our 1099 income program as it may end up giving them more income—and even greater buying power than they would with a Bank Statement Loan. The latter was designed for true business owners. So, an independent contractor earning 1099 wages is technically not self-employed. If the employer pays the applicant in 1099 wages, then the only time the applicant is considered self-employed is by the IRS when they file tax returns, and neither of these two programs uses them.

The two programs are remarkably similar, in terms of minimum down payment, minimum credit scores, etc.

Yes, but unless the business partner is also qualifying for the same home loan with you, then it would reduce the amount of income by their percentage. It could in turn significantly reduce the amount of house they can afford. For instance, by owning 50% of the business, then the borrower can only use 50% of the income from the bank statement income analysis.

Yes. We will calculate the business owner’s income using Bank Statement and the spouse’s income will be calculated with their W2s, pay stubs, and an Employment Verification.

No. IRS Form 4506-C authorizes us to pull a tax return transcript and signing one is not required for a self-employed mortgage.

No. Co-signers and applicants who are not occupying the new home are not allowed on a 12/24 month Bank Statement Loan Program.

YES, as long as the bankruptcy, foreclosure, or short sale is completed at least 12 month ago or longer. Depending on the length of time after the certificate of title date, it may affect the minimum down payment on a home.

No. Cryptocurrency deposits cannot be used to qualify for a Bank Statement Only US bank accounts can be used in the income calculation.