Bank Statement Loans in Alabama and Florida
Self-employed and your tax return does not show what you really earn? A bank statement loan reads your deposits instead.
A standard mortgage counts the income left after your write-offs. A business owner who deducts well can look like a much smaller earner on paper. A bank statement loan looks at 12 or 24 months of deposits and works out an income figure from the cash that actually came in. Mountain Mortgage arranges bank statement loans for self-employed buyers and refinancers in Alabama and Florida.
Get a bank statement loan quote. Send us your last 12 months of statements and we will estimate your qualifying income.
Why self-employed buyers choose a bank statement loan
- Deposits replace tax returns. The lender uses your statements to calculate income. Two years of returns are usually not the test.
- Write-offs stop hurting you. Deductions that lower your tax bill do not shrink the income figure the same way.
- It fits many business types. Contractors, owners, freelancers, gig workers and commission earners use these programs.
- The path is clear. You can see your estimated qualifying income before you make an offer.
How qualifying income is calculated
The lender adds up eligible deposits over the review period and averages them by month. Business account deposits are usually reduced by an expense factor, because some of that money went to costs. Personal account deposits are often counted in full. Transfers between your own accounts and unexplained cash deposits are removed. For every step with a 12 month and 24 month comparison, read how lenders count your deposits for a bank statement loan.
Here is an illustration with made-up numbers. A business account shows $216,000 of eligible deposits over 12 months. The program applies a 50 percent expense factor.
| Step | Amount |
|---|---|
| Eligible business deposits, 12 months | $216,000 |
| Monthly average ($216,000 divided by 12) | $18,000 |
| Expense factor of 50 percent | minus $9,000 |
| Qualifying monthly income | $9,000 |
The same business could show far less taxable income after deductions. That gap is the reason these loans exist. Expense factors differ by program, and some allow a lower factor when a CPA letter supports it. These figures are an illustration, not a quote.
What lenders typically look at
Every program sets its own limits. The ranges below are common in the market. We confirm the exact terms for your file before you commit.
| Factor | Common range | What it changes |
|---|---|---|
| Bank statements | 12 or 24 months, personal or business | More months can smooth an uneven year |
| Time self-employed | About 2 years, sometimes 1 with prior experience in the field | Shows the income is stable |
| Credit score | Roughly 620 and up | Higher scores unlock better pricing |
| Down payment | 10 to 20 percent | More down lowers the rate and the payment |
| Reserves | Several months of payments after closing | Proves you can cover a slow month |
The trade you should know about
A bank statement loan usually carries a higher rate and a larger down payment than a standard loan. You are paying for flexible income rules. If your tax returns already show enough income, a conventional loan may cost less. Our guide to conventional loans in Alabama and Florida shows when that is the better route. We compare both and tell you which one costs less.
Who this loan fits
It fits a business owner with strong deposits and heavy write-offs, a contractor or freelancer with an uneven year, or a buyer who changed careers into self-employment and has a track record. It fits less well when your deposits are mostly transfers, when your balances often run low, or when your credit has recent problems. We tell you early which side of that line you are on.
Alabama and Florida notes
Alabama
Alabama charges a mortgage recordation tax of $0.15 per $100 of the loan. On a $300,000 loan that is $450. Many self-employed buyers in Huntsville, Birmingham and Mobile run service businesses with steady monthly deposits, which makes the statement review straightforward.
Florida
Florida taxes a financed loan twice, with documentary stamps of $0.35 per $100 on the note and a nonrecurring intangible tax of 0.2 percent of the loan. On a $300,000 loan that is $1,050 plus $600. Florida insurance and association dues also count in the payment, so we ask for the insurance quote early. These rates change, so confirm them before closing.
What we need to start
- Your last 12 months of personal or business bank statements, or 24 months if you want the longer average.
- Your business license or other proof of how long you have been self-employed.
- The property address and purchase price, or the current value for a refinance.
- Proof of your down payment and reserves.
We return your estimated qualifying income, the structure that fits, the full cost in dollars and a realistic closing date. To size a payment, use the monthly payment estimator. To plan your cash at closing, use the closing cost calculator. For investment purchases, see DSCR loans in Alabama and Florida.
Frequently asked questions
What is a bank statement loan?
A bank statement loan is a mortgage that uses 12 or 24 months of bank deposits to calculate income. It is built for self-employed borrowers whose tax returns understate what they earn.
How many months of bank statements do I need?
Most programs accept 12 or 24 months. Twelve months is faster. Twenty four months can help if your income varies from year to year.
What credit score do I need?
Many programs start around 620. Higher scores usually bring lower rates and a smaller required down payment.
How much down payment is required?
Commonly 10 to 20 percent. The exact amount depends on your credit score, the property and the program.
Is the rate higher than a regular mortgage?
Usually yes. The rate and down payment reflect the flexible income rules. We compare it with a conventional loan so you see the real cost difference.
Can I use a bank statement loan to refinance?
Yes, many programs allow rate and term and cash out refinances. Waiting periods and limits vary by program.