The Power of Bank Statement Home Loans

Key Benefits of Bank Statement Loans

1. No Tax Returns Required

   • Instead of tax returns or W-2s, you qualify using 12–24 months of personal or business bank statements.

2. Ideal for Self-Employed Borrowers

   • Perfect for business owners, freelancers, and gig economy workers who may write off significant expenses on taxes.

3. Higher Loan Approval Flexibility

   • Underwriting is based on cash flow, not taxable income, making it easier to qualify for higher loan amounts.

4. Multiple Property Financing Options

   • Great for investors or entrepreneurs purchasing multiple properties or high-value homes.

5. Competitive Interest Rates

   • Rates are higher than traditional loans, but still competitive given the flexibility.

6. Can Be Used for Various Property Types

   • Applicable for primary residences, second homes, and investment properties.

Key Features

Income Verified Using Bank Deposits

Typically based on average monthly deposits from 12 or 24 months of statements.

Credit Score Minimums

Most lenders require a minimum credit score of 620–660, depending on loan terms.

Loan Amounts

Often available up to $3 million, depending on lender guidelines.

Down Payment Requirements

Minimum 10% down

No Private Mortgage Insurance (PMI)

Many bank statement loan programs do not require PMI, even with less than 20% down.

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Switching from an Adjustable-Rate Mortgage (ARM) to a Fixed Rate – If your ARM is about to adjust to a significantly higher rate, locking in a fixed rate can provide stability and predictability in payments.

Eliminating Private Mortgage Insurance (PMI) – If your home value has increased enough to reach at least 20% equity, refinancing—even at a higher rate—could remove PMI and lower your overall monthly costs.

Accessing Home Equity Through a Cash-Out Refinance – If you need funds for home improvements, debt consolidation, or other financial goals, a cash-out refinance might be a better option than higher-interest alternatives like credit cards or personal loans. I recently helped a Veteran save over $1,000 per month by paying off his debt and even getting cash to update his home. Since he is saving so much on a monthly basis, he will apply the savings to the principal every month and will more than likely payoff his mortgage at a much faster pace.

Reducing Loan Term for Faster Payoff – Refinancing from a 30-year to a 15-year loan can result in higher monthly payments but significantly less interest paid overtime, helping you build equity faster.

Divorce or Removing a Co-Borrower – If you need to remove a co-borrower from the mortgage due to divorce or other reasons, refinancing is often necessary, even if it means a higher rate.

Improving Loan Type or Terms – If you originally took out a loan with unfavorable terms, refinancing into a more stable or beneficial program (such as moving from an FHA loan to a conventional loan) can make sense despite a rate increase.

It’s all about overall savings and making the correct financial moves to eventually become financially free. Every scenario is very different, if you would like to go over your scenario call me for a free no obligation consultation. Your future self and pocketbook will thank you 619-208-6499.

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Non QM loans

(Non-Qualified Mortgage loans) are designed for borrowers who don’t meet the strict criteria of a Qualified Mortgage (QM), typically because they have unconventional income sources or unique financial situations. These loans offer more flexibility compared to traditional loans, making them attractive to certain borrowers.

Key Benefits of Non QM Loans:

1. Flexible Income Verification

• Alternative Documentation: Non-QM lenders allow alternative forms of income verification such as bank statements, profit and loss statements, or assets, rather than traditional pay stubs or W-2s.
• Ideal for Self-Employed or Gig Workers: Many non-QM loans cater to self-employed individuals, freelancers, or business owners who might not have consistent or easily documented income.

2. Higher Debt-to-Income (DTI) Ratios

• Higher Tolerance for Debt: Traditional QM loans generally cap DTI ratios at 43%, but non-QM loans may allow for higher DTIs. This can be especially beneficial for borrowers with high monthly debt obligations but strong cash flow or assets.

3. Credit Score Flexibility

• For Borrowers with Imperfect Credit: Non-QM loans offer more leniency for borrowers with lower credit scores, recent credit issues (like bankruptcies or foreclosures), or limited credit history, making homeownership more accessible to those who may not qualify for conventional loans.

4. No Strict Loan Limits

• Higher Loan Amounts: Non-QM loans don’t adhere to the loan limits set by agencies like Fannie Mae and Freddie Mac, allowing for larger loan amounts (often referred to as jumbo loans), which is ideal for buyers of luxury or high-priced properties.

5. Customizable Loan Terms

• Interest-Only Payment Options: Many non-QM loans offer interest-only periods, where borrowers only pay the interest for a set time, making monthly payments lower in the initial years.
• Longer or Adjustable Terms: Borrowers can access a variety of loan structures, including adjustable-rate mortgages (ARMs), and terms that can be tailored to their financial situation.

6. Fast Approval Process

• Expedited Underwriting: Since non-QM loans don’t have to follow the same stringent regulations as QM loans, the underwriting process can be faster and more flexible, often allowing borrowers to close on loans more quickly.

7. Diverse Borrower Profiles

• Foreign Nationals: Non-QM loans can cater to foreign nationals and others without a U.S. credit history.
• Investors: Real estate investors looking to expand their portfolio without traditional income verification can benefit from the flexibility of non-QM loans.

Who Benefits from Non-QM Loans?

• Self-employed individuals with fluctuating income or complex tax returns.
• Real estate investors who prefer using rental income or assets to qualify.
• Borrowers with credit challenges, like low FICO scores, bankruptcies, or foreclosures.
• High-net-worth individuals who want to leverage their assets instead of traditional income streams.
• Foreign nationals without U.S. credit history.

Non-QM loans provide an excellent alternative for borrowers who don’t fit the conventional mold, offering greater flexibility in income documentation, loan terms, and credit requirements.

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Working With Us Will Help Support Your Community

At Andre Enriques Mortgage Banker – VA Loan Expert (aka First Priority Home Loans), we believe in the power of business to help make a positive impact on our world. We are excited to introduce our new initiative starting January 2024, we are launching a ” Giving Back Campaign,” whereby doing business with us, 5% of our net proceeds will be donated to a charity of your choice at close of escrow, a cause close to your heart.

Why Choose Andre Enriques Mortgage Banker – VA Loan Expert (aka First Priority Home Loans)? Not only will you receive high-quality mortgage products/services from us, but you’ll also be contributing to a worthy cause. With every loan closed through us, you play a crucial role in supporting a worthy cause.

How It Works:

1. Close your purchase or refinance with Andre Enriques Mortgage Banker – VA Loan Expert (aka First Priority Home Loans)
2. 5% of our net earnings will go to a charity of your choice.

Our Commitment:

• Transparency: We will apply your donation immediately after closing escrow.
• Community Engagement: We love to be involved in our community and love giving back to a worthy cause.

Spread the Word: Help us make a bigger impact by sharing this initiative and our services with your friends and family. Together, we can create a ripple effect of positive change!

Thank you for choosing Andre Enriques Mortgage Banker – VA Loan Expert (aka First Priority Home Loans). Let’s make a difference, one closing at a time.

With gratitude,

Andre Enriques Mortgage Banker – VA Loan Expert (aka First Priority Home Loans)

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2024 Loan Limits Are Out!

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Mortgage Tips

Want to save big on your mortgage?

Make it automatic!  Set up bi-weekly automatic payments and watch your savings grow over time. Here’s how:
Automatic Biweekly Payments

Split your monthly payment in half and pay every two weeks. You won’t feel much of a difference on your budget, but you will see your mortgage balance drop year after year.  This should result in an extra payment each year and can shave years off your mortgage term!

Round Up Your Payments

Round up your payments to the nearest hundred or thousand. For example, if your payment is $985, round it up to $1,000. Over time, this small change can make a big difference in your total interest paid. By doing so, you allow for less interest to accrue and eventually you will pay more to your principal vs. interest. Generally speaking, you will pay more towards the principal of your mortgage by the 10th year of a 30-year mortgage.

Refinance

Refinancing your mortgage can lower your interest rate, reduce your monthly payment, and could save you thousands in interest over the life of the loan. It’s recommended to refinance only when you save at least .50% of a point because you want to have enough monthly savings to recoup the cost of the refinance within 36 months.

By making your mortgage savings automatic, you’ll be on your way to financial freedom in no time! Having a paid off mortgage is a great accomplishment that many can only dream of and by following these tips you’ll be there before you know it.

As always, I’m here to help you with all your mortgage needs. For more mortgage tips feel free to contact me directly.

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Hot off the press!!! FHA just announced the reduction of the monthly mortgage insurance premium!! This is great news for FHA buyers because this will give homebuyers more home buying power and monthly savings. FHA monthly mortgage insurance premium will be reduced from .85% down to .55% for loan amounts at or below $726,200. Now for FHA high balance loans with loan amounts between $726,200 and $977,500 in San Diego County, the monthly mortgage insurance premium will also be reduced from 1.05% down to .75%. These changes are set to take effect on FHA loans submissions registered on or after March 20th, 2023 however, we will implement these changes on February 27th, 2023. These reductions are based on the minimum of 3.5% down payment but below is the full list of other MIP amounts depending on down payment and term of the loan. FHA’s annual MIP is calculated as a percentage of the outstanding loan balance. For example, an outstanding loan balance of $200,000 with a 50 basis point (0.5%) annual MIP, would yield an annual MIP amount of $1,000.

Contact me to learn more about FHA loans or any other loan products that I offer. I’d be happy to help.

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Unlocking The Secrets of Mortgage Loans

A mortgage loan is a loan used to purchase a home. The loan is secured by the property itself, giving the lender the right to take ownership of the property if the borrower fails to make payments. Mortgage loans are typically long-term loans, with a repayment period of 15 or 30 years. The amount of the loan is usually determined by the borrower’s credit score and the value of the home. Mortgage loans come in many different types, including fixed-rate, adjustable-rate, and interest-only loans. Each loan product has its own advantages and disadvantages, and it is important to understand the differences before choosing a loan. In addition, there are special types of loans available for first-time homebuyers, Veterans, and other borrowers with special needs. It is important to research all of your options before making a decision. In order to qualify for a mortgage loan, the borrower (s) must have the minimum required credit score and be able to demonstrate their ability to make the monthly payments on time. Borrowers must also provide proof of income such as pay stubs, tax returns, and have enough money saved for a down payment (If applicable). Borrowers should also be aware of any additional fees or costs associated with the loan, such as closing costs, appraisal fees, and other expenses. It is important to understand all of the costs before signing your final loan documents. Mortgage loans can also carry risks, such as the risk of foreclosure if payments are not made on time as agreed per the Note. Borrowers should also be aware of the potential for interest rate increases if they choose an adjustable-rate loan. In conclusion, Mortgage loans can be a great way to purchase a home, but it is important to understand the process and the associated risks before taking out a loan. Borrowers should research their options and compare different types of loans before making a decision. It is also important to consider all of the costs associated with the loan, and to make sure that the loan is affordable. With the right information, borrowers can make an informed decision and find the best loan for their needs. I am here to help guide you through the process and to go over all the loan options available to you.

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VA home loan calculator is great but are not always accurate and can be found on various websites such as VA.gov, Bankrate.com, and Zillow.com. These calculators allow you to input information such as your income, credit score, and the price of the home you are interested in purchasing to estimate your potential loan amount, monthly payment, and other costs associated with a VA home loan. Many times, a VA home loan calculator can be misleading as they tend to quote inaccurate interest rates or incorrect property tax and Insurance amounts. It’s important to note that these calculators are only estimates and actual loan terms may vary. It’s always best to consult with a VA approved lender (such as myself) for a more accurate assessment. My team and I do not charge to assist with your home loan pre-approval, provide competitive rates, and waive all lender fees for Veterans. The average turn time for a full pre-approval is 24-48 hours from the point when a fully completed credit application is received and all required documentation is provided.

Benefits of a pre-approval/Accurate numbers

A pre-approval is a detailed process in which a lender evaluates a potential borrower’s creditworthiness (in accordance with the VA Guidelines) and provides a pre-approval letter indicating the maximum loan amount for which the borrower may be approved. There are several benefits to obtaining a pre-approval for a home loan:

1. It gives you a clear idea of how much you are qualified for to spend on a home, which can help you narrow down your search and save time.
2. It shows sellers that you are a serious and qualified buyer, which can give you an edge over other offers on a property.
3. It can speed up the closing process, as the lender has already evaluated your creditworthiness and determined the maximum loan amount for which you may be approved.
4. It can also help you get better rate and terms as lender has done their due diligence and ready to lend you money.
5. It can also give you an insight of your credit score and areas where you need to work on.

It’s important to take note that a pre-approval is not a guarantee to lend, and final approval is subject to a property appraisal and the lender’s underwriting guidelines. Luckily, I have been closing VA loans for over two decades and constantly keep up on the VA guidelines to help ensure a smooth stress-free closing once you find the perfect home.

To experience my great rates and service, contact me directly! Why use a VA home loan calculator? when I can help give you accurate information. I’m always here ready to help answer all your VA loan questions or concerns.

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Questions For Your Lender

If it’s your first time buying a home, or you’re looking for a new place to live, knowing the right questions to ask your lender will put you ahead of the game.

The 3 Key Questions You should ask a lender when buying a home:

1. How much home can I afford?
First things first. Learn how much home you can afford by becoming pre-approved for a mortgage loan. This process involves providing your basic financial information to your lender (such as myself), such as your two most recent consecutive pay stubs, two most recent bank statements, most recent TSP or 401K statement, and two most recent tax returns. The lender will then look at several factors such as your credit history and credit score, employment history, and the ratio of your monthly debt payments to your income to determine your loan amount. The max debt to income ratio varies depending on the loan product.

2. What type of loan do you recommend for me? Why?
There are various mortgage loans that you may find more suitable for you. For example, military veterans and first-time homebuyers may be eligible for special low down or no down payment loan programs. Ultimately my goal is to provide you the loan with the most competitive rate and lowest payment. Factors such as down payment and credit score play a huge role in the loan program with the lowest rate and payment.

3. How much of a down payment do I need?
Depending on the type of mortgage loan you choose and/or qualify for, this may vary. However, there are options available for you to put down as little as 3%…. In some situations, No down payment at all! Yes! You heard me right!!!! Zero down payment!

Questions for your lender? Still not sure where to start? Send me a message and we’ll discuss it further! Every scenario is different and I’m here to look out for your best interest.

I look forward to hearing from you and providing you the answers for all your lender questions. My goal is to provide you the honesty, integrity, and professionalism you deserve.

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