Bank Statement / Stated Income / No Income programs don’t require self-employed customers to qualify with tax returns.
Initially after the market crash, there was inhibition in the land of loans about what constituted responsible lending. Lenders only wanted to entertain the most cookie-cutter of the cookie cutter situations. Because of this, business owners who saved their money then reinvested back into their company were penalized when their brilliant accounting saved thousands in taxes.
If a business owner makes $100k in a tax year, then reinvests $40k of their saved money into their business, they effectively with most lenders drop their home purchasing power by hundreds of thousands of dollars. Someone who may qualify for a $500k home could then only qualify for a $300k home. Or someone who should qualify for a $1M home now only qualifies for half as much. Or what if you already own your home and want to capitalize on lower interest rates? Or access your equity for debt strategies? When a lender reduces your qualifying income it cancels opportunities which otherwise might be available.
Alternative programs, known as Bank Statement / Stated Income / No Income, are great solutions because the lenders don’t use tax returns to calculate income. They don’t ask for them and they don’t need them. These lenders make sense of the world and recognize that when you own a company, you plain and simple have different tax rights. Having different tax rights doesn’t mean you don’t know how to save and properly spend your money. It means you need different options. We know about these options not only because we’ve got years of experience helping people with them, but because we’re business owners ourselves.