## What is a Bank Statement Mortgage?
A bank statement mortgage is a type of mortgage that uses your bank statements to prove your income and expenses, rather than relying on traditional documentation such as pay stubs or tax returns. This can make it easier to qualify for a mortgage if you have irregular income or if you are self-employed.
### How does a bank statement mortgage work?
When you apply for a bank statement mortgage, the lender will ask you to provide them with your bank statements for the past 12-24 months. The lender will then use these statements to calculate your average monthly income and expenses.
The lender will also look at your bank statements to see if there are any large deposits or withdrawals that could indicate that you are not being truthful about your income or expenses.
If the lender is satisfied with your bank statements, they will approve you for a mortgage. The amount of the mortgage that you will be approved for will be based on your income and expenses, as well as your credit score and other factors.
### What are the benefits of a bank statement mortgage?
There are many benefits to getting a bank statement mortgage, including:
* **Easier to qualify:** Bank statement mortgages can be easier to qualify for than traditional mortgages, especially if you have irregular income or if you are self-employed.
* **No need for pay stubs or tax returns:** You don’t need to provide the lender with pay stubs or tax returns, which can save you time and hassle.
* **Faster approval process:** The approval process for a bank statement mortgage is often faster than the approval process for a traditional mortgage.
### What are the drawbacks of a bank statement mortgage?
There are a few drawbacks to getting a bank statement mortgage, including:
* **Higher interest rates:** Bank statement mortgages often have higher interest rates than traditional mortgages.
* **Smaller loan amounts:** The loan amounts for bank statement mortgages are often smaller than the loan amounts for traditional mortgages.
* **Not all lenders offer bank statement mortgages:** Not all lenders offer bank statement mortgages, so you may need to shop around to find a lender that offers this type of mortgage.
### Is a bank statement mortgage right for you?
A bank statement mortgage may be a good option for you if you have irregular income or if you are self-employed. However, it is important to compare the interest rates and loan amounts of bank statement mortgages to traditional mortgages before making a decision.
## How to apply for a bank statement mortgage
If you are interested in applying for a bank statement mortgage, you will need to gather the following documents:
* Your bank statements for the past 12-24 months
* A copy of your driver’s license or other government-issued ID
* A copy of your Social Security card
* A letter from your employer stating your income and employment status (if you are employed)
* A profit and loss statement (if you are self-employed)
Once you have gathered these documents, you can apply for a bank statement mortgage online or in person at a bank or credit union. The approval process typically takes 1-2 weeks.
## Conclusion
Bank statement mortgages can be a good option for borrowers who have irregular income or who are self-employed. However, it is important to compare the interest rates and loan amounts of bank statement mortgages to traditional mortgages before making a decision.