What is a no income verification mortgage?

A no income verification mortgage (also called a non-QM loan) doesn't require traditional W-2s or pay stubs to prove income. Instead, lenders use alternative documentation like bank statements, asset depletion, or 1099s. These loans are designed for self-employed borrowers, business owners, freelancers, and investors.

Are no doc mortgages legal in 2026?

Yes, but they're different from pre-2008 'stated income' loans. Today's no-doc loans still verify your ability to repay—just through alternative methods like 12-24 months of bank statements instead of tax returns. They comply with Dodd-Frank regulations and are considered non-QM (non-qualified mortgage) loans.

What credit score do I need for a bank statement loan?

Most bank statement loan lenders require a minimum 620 credit score, but 680+ gets you better rates. Some lenders go as low as 580 with compensating factors (larger down payment, more reserves). The best rates require 720+ credit scores.

How many months of bank statements do I need?

Most lenders require 12-24 months of personal or business bank statements. Some programs accept just 12 months for borrowers with strong credit and reserves. The lender calculates your income by averaging deposits over this period.

What are bank statement loan rates in 2026?

Bank statement loan rates in 2026 typically range from 7.5% to 9.5%, about 1-2% higher than conventional loans. Rates depend on credit score, down payment, and loan amount. With a 720+ score and 20%+ down, you can find rates closer to 7.5%.

Can I get a no income verification loan for investment property?

Yes! DSCR (Debt Service Coverage Ratio) loans are perfect for investment properties. They qualify you based on the property's rental income potential, not your personal income. If the rent covers the mortgage payment (1.0+ DSCR), you can qualify regardless of personal income.

How is income calculated on a bank statement loan?

Lenders typically use one of two methods: 1) Average all deposits over 12-24 months, or 2) Use an 'expense factor' (usually 50%) for business accounts to account for business expenses. Personal bank statements usually count 100% of deposits as income.

Can I use personal and business bank statements together?

Yes, many lenders allow you to combine personal and business bank statements. This can increase your qualifying income. However, business statements typically have a 50% expense factor applied, while personal statements count at 100%.

What deposits count as income on bank statement loans?

Regular, recurring deposits from business activities count as income. Lenders exclude: large one-time deposits, transfers between accounts, loan proceeds, tax refunds, and gifts. Consistent deposit patterns strengthen your application.

Can I get a bank statement loan with a recent bankruptcy?

Yes, but you'll need to wait 2-4 years after discharge depending on the lender. Chapter 7 bankruptcy typically requires a 4-year waiting period, while Chapter 13 may only require 2 years. You'll also need to rebuild credit to at least 620.

What's the maximum loan amount for bank statement loans?

Bank statement loans can go up to $3-5 million with some lenders. Jumbo bank statement loans (over $766,550 in most areas) are available but may require higher down payments (15-25%) and credit scores (680+).

Do bank statement loans require PMI?

Bank statement loans with less than 20% down typically require PMI (Private Mortgage Insurance). However, some lenders offer 'lender-paid PMI' options where the cost is built into a slightly higher interest rate, eliminating the separate PMI payment.

Mortgage Calculator 2025 | Compare Rates & Save Thousands

Can't prove income with W-2s? Bank statement loans let you qualify using 12-24 months of deposits instead of tax returns. Perfect for business owners, freelancers, gig workers, and investors. Get approved in 2026 without traditional income documentation.

In This Guide:

What is a bank statement loan and how it works
Types of no income verification loans in 2026
Requirements and credit score minimums
How income is calculated from bank statements
Who qualifies for these loans
Step-by-step application process

✓ No W-2s Required✓ No Tax Returns✓ Self-Employed Friendly✓ Close in 30-45 Days

What Is a Bank Statement Loan? 📊

A bank statement loan is a type of non-QM (non-qualified mortgage) that uses your bank deposits to verify income instead of traditional documentation like W-2s, pay stubs, or tax returns.

Here's how it works: The lender reviews 12-24 months of your personal or business bank statements and calculates your income based on average monthly deposits. This is perfect for self-employed borrowers whose tax returns show lower income due to business deductions.

💡 Real Example:

Maria owns a successful consulting business. Her tax returns show $80,000 income after deductions, but her bank statements show $180,000 in deposits. With a traditional loan, she'd qualify for a $300,000 mortgage. With a bank statement loan, she qualifies for $650,000+!

Think you might qualify? Compare bank statement loan lenders and see your options.

Types of No Income Verification Loans 2026 📋

📊

Bank Statement Loan

12-24 months of bank statements to verify income. Best for self-employed with strong deposits.

Rates: 7.5% - 9.5%

🏠

DSCR Loan

Qualify based on rental income, not personal income. Perfect for real estate investors.

Rates: 7.0% - 9.0%

💰

Asset Depletion

Use liquid assets to qualify. Great for retirees or those with substantial savings.

Rates: 7.5% - 9.0%

📄

1099 Income Loan

Use 1099 forms instead of tax returns. Ideal for contractors and gig workers.

Rates: 7.25% - 8.75%

Find Your Best Loan Type →

Bank Statement Loan Requirements 2026 📝

Requirement	Minimum	Best Rates
Credit Score	620	720+
Down Payment	10%	20%+
Bank Statements	12 months	24 months
Cash Reserves	3 months	6+ months
DTI Ratio	50%	43% or less

Who Should Use Bank Statement Loans? 🎯

💼

Self-Employed Business Owners

Your tax returns don't reflect your true income due to business deductions.

💻

Freelancers & Consultants

Variable income that's hard to document with traditional methods.

🚗

Gig Economy Workers

Uber, DoorDash, Instacart drivers with multiple income sources.

🏠

Real Estate Investors

DSCR loans let you qualify based on rental income, not personal income.

📈

Commission-Based Salespeople

Income varies month to month but bank deposits show strong earnings.

🚀

Recently Self-Employed

Less than 2 years self-employed? Some programs accept 12 months of statements.

Check If You Qualify →

How Lenders Calculate Your Income from Bank Statements 🧮

Understanding how lenders calculate income from bank statements is crucial for maximizing your borrowing power. Here's the exact formula most lenders use:

📊 Income Calculation Methods

Personal Bank Statements

100% of deposits counted

Formula: Total Deposits ÷ # of Months = Monthly Income

Business Bank Statements

50% expense factor applied

Formula: (Total Deposits × 50%) ÷ # of Months = Monthly Income

💡 Real Calculation Example:

John is a freelance web developer applying for a bank statement loan:

• 24 months of business bank statements
• Total deposits: $480,000
• After 50% expense factor: $240,000
• Monthly qualifying income: $240,000 ÷ 24 = $10,000/month
• At 43% DTI, max payment: $4,300/month
• Estimated max loan: $650,000-$700,000

Top Bank Statement Loan Lenders 2026 🏆

Compare the best non-QM lenders offering bank statement programs. Rates updated December 2025.

Lender	Min. Credit	Down Payment	Statements	Max Loan
Angel Oak	620	10%	12-24 mo	$3M
Citadel Servicing	580	15%	12-24 mo	$2.5M
Newfi Lending	660	10%	12 mo	$3M
Deephaven	620	10%	12-24 mo	$2.5M
Sprout Mortgage	640	10%	12-24 mo	$5M

Compare All Bank Statement Lenders →

DSCR Loans: No Income Verification for Investors 🏠

DSCR (Debt Service Coverage Ratio) loans are the ultimate no-income-verification option for real estate investors. Instead of verifying YOUR income, lenders look at the PROPERTY's income potential.

📊 How DSCR Is Calculated

DSCR = Monthly Rent ÷ Monthly Mortgage Payment (PITIA)

PITIA = Principal + Interest + Taxes + Insurance + HOA

Below 1.0

Negative Cash Flow

Hard to qualify

1.0 - 1.25

Break-Even

Most lenders accept

1.25+

Positive Cash Flow

Best rates available

💡 DSCR Example:

Investment Property: Expected rent $2,500/month. PITIA payment $2,000/month.
DSCR: $2,500 ÷ $2,000 = 1.25
Result: Qualifies for DSCR loan with good rates — no personal income verification needed!

Step-by-Step: How to Get a Bank Statement Loan 📝

Gather Your Bank Statements

Collect 12-24 months of personal and/or business bank statements. Download PDF statements directly from your bank for best results.

Calculate Your Qualifying Income

Add up all deposits, apply expense factor if business (50%), divide by number of months. This is your qualifying monthly income.

Check Your Credit Score

Most lenders need 620+, but 680+ gets better rates. Pull your credit report and dispute any errors before applying.

Compare Lenders & Get Pre-Approved

Shop multiple non-QM lenders. Rates and terms vary significantly. Get pre-approval letters from 2-3 lenders.

Submit Full Application

Provide bank statements, ID, business license (if applicable), and property info. Underwriting takes 2-3 weeks.

✓

Close on Your Home!

Complete appraisal, title work, and close. Total timeline: 30-45 days from application to keys.

Bank Statement Loan vs Traditional Mortgage: Full Comparison 📊

Feature	Bank Statement Loan	Traditional Mortgage
Income Documentation	Bank statements only	W-2s, tax returns, pay stubs
Interest Rates	7.5% - 9.5%	6.0% - 7.0%
Min. Down Payment	10%	3% (conventional)
Min. Credit Score	620	620
Self-Employed Friendly	✅ Yes	❌ Difficult
Max DTI	50%	43-45%
Closing Time	30-45 days	30-45 days
Tax Deductions Impact	No impact	Reduces qualifying income

Pro Tips: How to Maximize Your Approval Chances 💪

✅ Do This

Keep deposits consistent: Avoid large gaps in deposit patterns
Separate business/personal: Use dedicated business accounts
Document large deposits: Be ready to explain any unusual deposits
Build reserves: Have 3-6 months of payments saved
Pay down debt: Lower DTI = higher approval odds
Shop multiple lenders: Rates vary 1-2% between lenders

❌ Avoid This

Cash deposits: Hard to verify source, may be excluded
Account transfers: Moving money between accounts inflates deposits
New accounts: Lenders want established banking history
Overdrafts: NSF fees signal poor cash management
Mixing personal/business: Complicates income calculation
Applying too soon: Wait until you have 12+ months of statements

Self-Employed? Get Approved Without Tax Returns 💼

Bank statement loans let you qualify using your real income—not what your tax returns show. Compare lenders and get pre-approved today.

Compare Bank Statement Lenders →Get Pre-Approved Today

No Income Verification Mortgage 2026: Bank Statement Loans for Self-Employed