What Is a Bank Statement Loan?

A bank statement loan lets you qualify for a mortgage using your bank statements instead of tax returns, W-2s, or pay stubs. It’s designed for self-employed borrowers, business owners, and anyone with non-traditional income who has strong cash flow but doesn’t fit the conventional mortgage mold.

Instead of reviewing your tax returns — which often show lower income after write-offs — lenders analyze 12 to 24 months of deposits to assess your actual earning power.

Who It’s For

• Self-employed individuals and freelancers
• Small business owners and entrepreneurs
• Independent contractors and gig workers
• Real estate investors
• Anyone with strong cash flow but limited traditional income documentation

Key Benefits

• No W-2s or tax returns required — qualify based on bank deposits
• Personal and/or business bank statements accepted
• Loan amounts up to $5 million
• Flexible debt-to-income ratio requirements
• Multiple income sources allowed — including self-employment, rental income, royalties, and more
• Investment properties eligible

How to Qualify

Credit Score: Minimum 620. Higher scores improve your rate and approval odds.

Bank Statements: 12–24 months of personal and/or business statements showing consistent deposits and cash flow.

Additional Documents May Include:

• Business license
• Year-to-date profit and loss statement
• Balance sheet

Lenders focus on your ability to make monthly mortgage payments based on your deposit history — not just a single snapshot of income.

Things to Know

• Interest rates are typically higher than conventional mortgages, reflecting the flexibility in documentation
• Down payments generally range from 10–20% or more depending on the loan and lender
• Underwriting may be more thorough — be prepared to document your business and income sources clearly

How the Process Works

1. Connect with a Loan Officer Tell us about your income, business, and goals. We’ll let you know upfront whether a bank statement loan is likely the right fit and what you’ll need to move forward.

2. Submit Your Bank Statements Provide 12–24 months of personal and/or business bank statements. We’ll analyze your deposit history to determine your qualifying income.

3. Close on Your Home Once approved, we’ll guide you through the remaining steps — appraisal, underwriting, and closing. Most bank statement loans close on a timeline similar to conventional mortgages.

Why New Story Lending

We’re an independent mortgage bank based in Upstate South Carolina, and non-QM lending is a core part of what we do. That means we’re not trying to fit your situation into a box that wasn’t built for it — we’re experienced with bank statement loans, we work with self-employed borrowers regularly, and our team is bilingual (English and Spanish) for clients who prefer to work in Spanish.

When you work with us, you’re talking to people who understand your situation and want to help you find the right path to homeownership — not just process a file.

Frequently Asked Questions

What is a bank statement loan? A mortgage that uses 12–24 months of bank statements to verify income instead of tax returns or W-2s. Designed for self-employed borrowers.

How does it work? Lenders analyze your monthly deposits to determine income and repayment ability. Business expenses may be factored in using an expense ratio.

How hard is it to get one? It depends on your credit, down payment, and cash flow history. Requirements are more flexible than conventional loans in some ways, but documentation expectations are high.

How much do I need for a down payment? Typically 10–20%, though this varies by lender and loan size.

Can I use it for investment properties? Yes — investment properties are eligible under the bank statement loan program.

Can I use a bank statement loan to refinance? Yes. Bank statement loans are available for both purchases and refinances, including cash-out refinances on primary residences, second homes, and investment properties.

What’s the difference between a bank statement loan and a conventional loan? A conventional loan requires W-2s, tax returns, and pay stubs to verify income. A bank statement loan uses your deposit history instead — making it a better fit for self-employed borrowers whose tax returns don’t reflect their actual earnings.

What if my deposits vary month to month? That’s common for self-employed borrowers and is accounted for in the underwriting process. Lenders typically average your deposits over 12–24 months to smooth out seasonal or project-based fluctuations.

How long does it take to close? Timelines vary, but bank statement loans generally close within 30–45 days — similar to a conventional mortgage — when documentation is submitted promptly.

Have more questions? Contact us directly — our loan officers are happy to walk you through your options.