For business owners whose CPA can document real profit that a tax return and bank statements both miss.
Net income on the statement, divided by the months it covers. Then multiplied by how much of the business you own.
A 12-month P&L shows $540,000 in revenue and $216,000 in expenses. Net income is $324,000. She owns 100% of the business.
A 24-month P&L shows $624,000 of net income — $26,000 a month. He owns half the business, so half the income counts.
Net income — what the business earned after its expenses. It is the bottom line on the statement, not the total money that came in.
One thing that surprises people: your write-offs still reduce this number. A P&L only loan skips your tax return, but it doesn’t skip your expenses. If your business genuinely runs thin margins, a bank statement loan may produce a bigger number, because it works from deposits.
Want to see what that income supports? Run it through the Affordability Calculator.
This program solves a specific problem. If none of these sound like you, a different program is probably cheaper.
You’ll also generally need two years in the same business and a tax professional willing to prepare and stand behind the statement.
Not sure which program fits? The Self-Employed Mortgage guide lays every option out side by side.
| Program | What the lender reads | Best when | Typical min. down |
|---|---|---|---|
| Full doc | Net income on two years of tax returns | Your returns already show plenty of income | 3–5% |
| Bank statement | Deposits over 12 or 24 months | Income lands consistently in one account | 10–15% |
| P&L only | Net income on a CPA-prepared statement | Deposits are messy, split, or overstate the business | 20–25% |
The five that come up most — and the rest below them.
A mortgage that qualifies you using a profit and loss statement prepared by a licensed tax professional. The net income on that statement becomes your income. No tax returns, and on most programs no bank statement analysis.
A CPA, an enrolled agent, or a CTEC-registered tax preparer. You can’t prepare it yourself, and an unlicensed bookkeeper usually isn’t accepted.
Sometimes. Some lenders take the P&L alone. Others ask for two or three months of business statements as a sanity check. You’ll always need statements for the account holding your down payment.
Net income divided by the number of months the statement covers, multiplied by your ownership percentage. A 12-month P&L showing $324,000 of net income gives $27,000 a month at 100% ownership.
Two years in the same business is the standard. Some lenders will look at less with strong credit and a larger down payment.
Usually 20–25% on a primary home. Investment properties and larger loan amounts require more.
Most programs start around 660 to 700. Higher scores open more lenders and better pricing.
Not automatically. A bank statement loan usually prices better when your deposits are clean and land in one account. P&L only wins when deposits are split, comingled, or overstate what the business actually earns.
Yes. The preparer’s license gets verified and they’re usually contacted directly. Some lenders compare the statement against bank deposits. It has to be accurate.
Yes. In Los Angeles County anything above $1,249,125 is a jumbo loan, and P&L only programs go well past that.
Yes. Purchases, rate-and-term refinances, and cash-out refinances are all available.
Usually a little higher than a bank statement loan, since the lender is relying on one document. More money down and a higher score narrow the gap. Check Today’s Rates for where pricing sits now.
Send your net income and target home price. You’ll get a real qualifying number back — no application, no credit pull.