By Mike Basti, President and Mortgage Broker · NMLS #322904 · Updated Use whichever account produces more qualifying income. Personal statements count eligible deposits at or near 100%, so they win when you pay yourself a steady draw. Business statements show more volume but get an expense factor (commonly 50%); a CPA letter documenting lower real costs can cut that and often makes business statements the winner. Either works with 12 or 24 months, 640+ credit, 10% down with 700+ credit, and loans up to $3 million.
On this page
Personal vs business statements, side by side
| Personal statements | Business statements | |
|---|---|---|
| How deposits count | Usually 100% of eligible deposits | Deposits × (1 − expense factor) |
| Default expense factor | None | Commonly 50% |
| Lowering the haircut | Nothing to lower | CPA letter or low-overhead business; some programs go as low as 15% |
| Ownership rules | Account in your name | Usually 25%+ ownership; income limited to your share |
| Extra documents | Some lenders also want 2 months of business statements to trace your draws | Business license, Secretary of State filing or CPA letter |
| Best for | Owners who pay themselves a regular draw | Owners who leave most money in the business, or have low real costs |
If business and personal money share one account, lenders usually treat it like a business account and apply an expense factor. Keeping them separate for the months you'll submit makes the file cleaner.
The math on the same business
A consulting firm deposits $40,000 a month into its business account. The owner transfers $22,000 a month to her personal account. Here's what each route qualifies for:
| Route | Calculation | Monthly qualifying income |
|---|---|---|
| Business statements, 50% factor | $40,000 × 50% | $20,000 |
| Personal statements | $22,000 × 100% | $22,000 |
| Business statements, CPA letter at 30% | $40,000 × 70% | $28,000 |
Without the CPA letter, personal statements win by $2,000 a month. With it, business statements win by $6,000. That swing is why we calculate both before you choose. If she owned only 50% of the firm, the business figures would be cut in half, and personal statements would win easily.
How to lower the expense factor
- CPA or tax-preparer letter. States your actual expense ratio. If real costs are 20–30% of revenue, this is the most valuable document in the file.
- Low-overhead business types. Some lenders start lower for service businesses with no inventory, office or staff, such as a one-person consultant or online seller.
- A P&L instead. If your books are cleaner than your deposits, a P&L statement loan may show more income.
Not every lender accepts a CPA expense letter, which is one reason a broker shops several. More on the letter: CPA letters for mortgages.
12 vs 24 months, for either account
Both account types work with a 12-month or 24-month window. Pick 12 months if income grew in the last year. Pick 24 months if income is steady or seasonal, or had a temporary dip; the longer window can earn slightly better pricing.
Credit, down payment and loan limits
Account type doesn't change the credit and down payment rules:
| Credit score | Typical minimum down (primary home) | Pricing |
|---|---|---|
| 700+ | 10% | Best tiers |
| 660–699 | 15% | Strong |
| 640–659 | 20% | Program-dependent |
| Item | Typical range (October 2026) |
|---|---|
| Minimum credit score | 640; pricing improves at 660 and again at 700+ |
| Down payment, primary home | 10% with ~700+ credit; 15–20% with lower scores or larger loans |
| Down payment, investment property | 20–25% |
| Cash-out refinance | Up to about 75% loan-to-value |
| Loan amount | Up to $3,000,000 ($5,000,000 by exception) |
| Reserves | Often 3–6 months of payments, more on larger loans |
| Debt-to-income | Up to ~45%, some programs to 50% with conditions |
| Mortgage insurance | None at any loan-to-value |
| Property types | Primary, second home, 1–4 unit investment |
For the full list, see the bank statement loan requirements.
Personal vs business bank statement FAQs
Should I use personal or business bank statements for a mortgage?
Use whichever produces more qualifying income. Personal statements usually count 100% of eligible deposits and win when you pay yourself a steady draw. Business statements show more volume but get an expense factor, commonly 50%. With a CPA letter showing low real costs, business statements often win. We run both before you choose.
Do personal bank statements count at 100%?
Usually yes. Eligible deposits into a personal account are typically counted in full because the money has already left the business. Transfers between your own accounts, loan proceeds and refunds are still removed.
What is the expense factor on a business bank statement loan?
It is the share of business deposits a lender assumes went to running the business. The common default is 50%, so $40,000 of monthly deposits counts as $20,000 of income. Some lenders use lower factors for low-overhead businesses or accept a CPA letter documenting your real expense ratio.
Can a CPA letter lower the expense factor?
Often yes. Many lenders accept a letter from a CPA or IRS-approved tax preparer stating your actual expense ratio. If your real costs are 20–30% of revenue, the letter can raise qualifying income substantially. Some programs accept expense ratios as low as 15% with qualifying documentation.
What if my personal and business money are in the same account?
Lenders usually treat a mixed account like a business account and apply an expense factor. Keeping business and personal money separate for the months you will submit makes the file cleaner and often qualifies you for more.
Can I use my LLC or S-corp business account?
Yes, if you own a meaningful share, usually 25% or more. Qualifying income is limited to your ownership percentage, and the expense factor applies.
Do I need business statements if I use personal statements?
Sometimes. Some lenders ask for two months of business statements to confirm that your personal deposits are draws from your business.
What credit score and down payment do I need?
Most programs start at 640 credit. Around 700+ usually allows 10% down on a primary home; lower scores or larger loans typically need 15–20%. Investment properties need 20–25% down. Loans go up to $3 million, or $5 million by exception.
Can I use 12 or 24 months with either account?
Yes. Both personal and business statements work with a 12-month or 24-month window. Twelve months suits income that grew recently; 24 months suits steady or seasonal income and can earn slightly better pricing.
Terms shown are typical ranges as of October 2026 and vary by lender, credit, down payment and property. Reviewed by Mike Basti at Save Financial, a California-licensed mortgage brokerage (NMLS #377740, DRE #01875766) founded in 2009 and serving all 58 counties from offices in Newport Beach and Marina del Rey.