A Smarter Home Loan for the Self-Employed
Can You Get A Bank Statement Mortgage In The Washington DC Area? If you’re self-employed, own a business, or earn income as an independent contractor in the Washington DC Metro area, you already know the frustration: your cash flow is strong, but traditional mortgage rules don’t tell your real story.
Conventional loans rely heavily on W-2s, pay stubs, and tax returns—documents that often underrepresent the true earning power of entrepreneurs. Legitimate write-offs can make taxable income look far lower than reality, creating unnecessary roadblocks when it’s time to buy or refinance a home.
That’s exactly where Bank Statement Mortgages come in.
Instead of tax returns, this program allows qualified borrowers to use 12 or 24 months of personal or business bank statements to demonstrate income. Therefore, it’s a practical, flexible solution designed specifically for self-employed borrowers who don’t fit inside the traditional lending box.
Who Is a Bank Statement Loan Designed For?
This program is ideal for borrowers who earn real income—but not in a traditional way:
- Self-employed professionals
- Small business owners
- Independent contractors
- 1099 income earners
- Borrowers with as little as 25% ownership in a business
You do not need to own 100% of the company. Profit & Loss statements are also accepted and often help strengthen a file.
Bank Statement Loan Program Highlights
Loan Features at a Glance
- Maximum loan amount: Up to $4,000,000
- Minimum loan amount: $150,000
- Loan-to-Value & Credit
- Up to 75% LTV with a 640+ FICO
- Up to 90% LTV with a 720+ FICO
- Eligible properties:
- Primary residences
- Second homes
- Investment properties
- Loan purposes:
- Purchase
- Rate-and-term refinance
- Cash-out refinance
- Documentation:
- 12 or 24 months of bank statements
- Credit event seasoning:
- 2 years after bankruptcy, short sale, or foreclosure
- Residency:
- Permanent and non-permanent residents allowed
- Income calculation:
- 50% default expense factor (lower with CPA support)
- 1099 income: Accepted
- P&L statements: Accepted
How Income Is Calculated (Without Tax Returns)
Because tax returns aren’t used, lenders estimate income by applying an expense factor to your bank deposits.
- The standard expense factor is 50%
- High-expense industries (such as restaurants) may require up to 70%
- Lower expense factors are possible when supported by:
- A CPA
- Licensed tax preparer
- Professional bookkeeping service
As a result, this approach allows underwriters to responsibly estimate income while recognizing the realities of self-employment.
Gift Fund Guidelines
Gift funds are allowed—but borrower contribution is still required.
Primary Residence & Second Home
- Borrower must contribute 5% of the down payment from their own funds
- Must have 3 months of total housing payment in reserves from their own funds
- Remaining funds may be gifted
Investment Properties
- Borrower must contribute 10% of the down payment from their own funds
- Must have 3 months of reserves from their own funds
- Remaining funds may be gifted
Why Choose a Bank Statement Mortgage?
- No tax returns required
- Designed for entrepreneurs and business owners
- More flexible than traditional agency loans
- Ideal for borrowers with strong cash flow but non-traditional income reporting
- Supports purchases, refinances, and cash-out strategies
For many self-employed borrowers, this is the most realistic path to homeownership—or to accessing equity already earned.
How to Get Started
Getting pre-qualified is straightforward:
- Gather 12–24 months of bank statements
- Request a P&L statement (optional, but helpful)
- Schedule a consultation with a mortgage professional to confirm the best structure
A quick review can determine eligibility before you invest time or money into the process.
Let’s Get You Qualified
Whether you’re a freelancer, consultant, contractor, or business owner, you shouldn’t be penalized for how you earn your income.
A Bank Statement Mortgage offers flexible, responsible financing—without unnecessary red tape.
Contact me to discuss your mortgage needs. Schedule A Call or email brian@getloans.com
Brian Martucci is a loan officer for Capital Bank Home Loans, a division of Capital Bank, N.A. He has been in the mortgage industry since 1986 and has served in a number of roles, including loan processor, loan officer, mortgage broker, branch manager, and vice president. Brian Martucci – NMLS# 185421. His opinions do not necessarily reflect the opinions and beliefs of Capital Bank Home Loans or Capital Bank. Capital Bank, N.A.- NMLS# 401599. Click here for the Capital Bank, N.A. “Privacy Policy”.
