Bank Statement Loan

Bank Statement Loans are a type of unconventional mortgage primarily intended for self-employed borrowers or those with variable income streams. Rather than relying on traditional income documents like W-2s or tax returns, lenders use a borrower's bank statements to verify income, typically reviewing a 12-24 month period. This allows the lender to get a more comprehensive view of a borrower's cash flow and ability to repay the loan.

These loans can be advantageous for entrepreneurs, freelancers, or independent contractors who may not have steady paychecks but have a regular inflow of money in their bank accounts. While these loans often come with higher interest rates and may require larger down payments, they offer a flexible solution for those with non-traditional income patterns.