$500,000 purchase example: A self-employed Glen Allen buyer puts 20% down on a $500,000 home, creating a $400,000 bank statement mortgage. At 7.25% on a 30-year fixed term, principal and interest is about $2,729 per month. At 7.75%, it rises to about $2,865 – a $136 monthly difference and $8,160 over the first five years before taxes, insurance, and any future refinance. That is why getting the documentation, deposit story, and program fit right before an offer matters.
If you are searching for how to get bank statement mortgage financing, the short answer is that you need to show a mortgage broker consistent qualifying income through personal or business bank statements rather than W-2s and tax returns. The longer answer matters more: not every dollar deposited is income, and the right program depends on how your business is organized, your credit profile, your down payment, and the home you want in Glen Allen, Short Pump, or Innsbrook.
Duane Buziak, NMLS #1110647, works with buyers and homeowners who need a clearer path than a one-size-fits-all underwriting box. As Glen Allen Mortgage Broker of the Year 2025 through Alignable, Duane brings a local broker approach to borrowers whose income is real, reliable, and sometimes difficult to express on a standard tax return.
Table of Contents
- What a bank statement mortgage is
- How to get a bank statement mortgage approved
- What deposits count as income
- Credit, down payment, reserves, and costs
- Glen Allen market considerations
- Broker comparison and FAQs
What Is a Bank Statement Mortgage?
A bank statement mortgage is generally a non-QM home loan designed for self-employed borrowers, business owners, contractors, consultants, real estate professionals, and investors who have strong cash flow but deductions that reduce taxable income. Instead of relying primarily on tax returns, the underwriter reviews 12 or 24 months of bank statements and applies an expense factor when business statements are used.
For example, a business owner may deposit $20,000 per month into a business account. That does not automatically mean $20,000 is qualifying monthly income. If the program applies a 50% expense factor, the qualifying income may be $10,000 monthly unless a qualified professional documents a lower expense ratio. Personal bank statements can be more straightforward when business and personal cash flow are already separated cleanly.
These loans are not a shortcut around the ability-to-repay review. They are a different way to document it. A strong file shows recurring deposits, sufficient funds to close, reasonable credit management, and a believable explanation of the business behind the deposits.
How to Get a Bank Statement Mortgage: The Practical Process
Start with a soft credit pull and income review
Before touring homes aggressively, ask for a soft credit pull mortgage review. Glen Allen Mortgage can begin with a NoTouch Credit Pull available – a mortgage pre approval without hard pull process that helps estimate options without a hard inquiry or credit hit. A soft pull is useful for planning, though a hard inquiry may still be required later when you submit a full loan application and move toward underwriting.
Send the most recent 12 or 24 months of personal and, if applicable, business statements. A broker should review the deposits early, not after you are under contract. That first review identifies transfers, large one-time deposits, cash deposits, merchant processor activity, seasonal income, and business expenses that need explanation.
Keep the paper trail clean
Underwriters generally want complete statements, including every page, even pages that appear blank. Avoid moving money repeatedly between personal and business accounts without labels. Transfers can be excluded as duplicated income, while undocumented cash deposits can create questions that delay approval.
If you receive income through Stripe, Square, PayPal, rental platforms, commissions, or client ACH deposits, preserve statements that connect the source to the bank deposits. A concise letter of explanation is useful when it is factual and supported by records. It is not a substitute for documentation.
Choose the right occupancy and property fit
Bank statement financing can be used for primary residences, second homes, and some investment scenarios, depending on the program. Primary residence options commonly offer better terms than investment options. A condo, a new construction home, or a property with unusual features may have additional review requirements, so bring the property details into the conversation early.
Credit, Down Payment, Reserves, and Closing Costs
Many bank statement programs start around a 620 FICO score, but 660 to 680 or higher usually opens more favorable pricing and lower down payment possibilities. A 700-plus score can materially improve the menu of available programs. Credit score is only one piece: recent late payments, high revolving balances, collections, and major derogatory events can affect eligibility even with a strong score.
Down payments often begin around 10%, but 15% to 20% down can improve pricing and flexibility. Reserve requirements frequently run from three to 12 months of the full housing payment, depending on credit, loan amount, occupancy, and debt-to-income ratio. For the $400,000 example above, assuming a $3,350 total monthly housing payment including estimated taxes and insurance, six months of reserves equals $20,100.
Closing costs commonly range from roughly 2% to 5% of the loan amount, depending on points, appraisal complexity, title charges, escrow setup, and program selection. On a $400,000 loan, that is approximately $8,000 to $20,000 before any seller contribution or credits. Ask about our no-out-of-pocket closing options when appropriate. In any cost comparison, remember that Duane’s preferred title company can save an additional $2,000 on average, subject to transaction details and title services selected.
Why Local Market Context Changes the Strategy
Henrico County remains competitive in the price bands where many self-employed buyers shop. Redfin reported a Henrico County median sale price of approximately $420,000 in 2025, illustrating why buyers in Glen Allen, Wyndham, and Twin Hickory often need to be fully documented before they find the right property. Inventory and competition vary sharply by neighborhood, school zone, condition, and price point. A renovated home near favored schools may attract faster attention than a similar home requiring updates.
The 2026 baseline conforming loan limit is $832,750 in most Virginia counties, which means many area purchases can fit conventional financing if tax-return income supports it. But a conventional file is not automatically the best answer for a profitable business owner who takes legitimate deductions. FHA and VA financing can be excellent for eligible borrowers with documented qualifying income, while bank statement financing can be the better fit when deposits tell the truer income story.
Broker Access Versus a Single-Shelf Mortgage Option
There is no universally best mortgage company. The useful question is whether the professional reviewing your file can compare program structures that match your income. A mortgage broker can evaluate multiple program outlets, while a single-shelf provider may have a narrower set of bank statement guidelines.
| Decision factor | Mortgage broker approach | Single-shelf mortgage approach |
|---|---|---|
| Broker access | Can compare participating program outlets | Uses that company’s available program shelf |
| FICO floors | May compare programs with different score minimums | Minimums depend on the company’s guidelines |
| Program breadth | Can review conventional, FHA, VA, jumbo, non-QM, DSCR, and bank statement options | Varies by the company’s product lineup |
| Pricing flexibility | Can compare rate, points, and qualification trade-offs across outlets | Pricing is limited to available in-house offerings |
| Documentation fit | Can match personal or business statement methodology to the file | Depends on the specific program offered |
Do not confuse a no hard inquiry mortgage pre approval conversation with a final approval. A soft pull mortgage broker review is a smart first step, but final approval still requires complete documentation, underwriting, appraisal where required, title review, and conditions cleared. The benefit is that you can identify likely obstacles before an offer deadline creates pressure.
Questions to Ask Before You Apply
Ask whether the program uses 12 or 24 months of statements, whether it accepts personal or business accounts, what expense factor applies, how large deposits are treated, and whether prepayment penalties are available or avoidable. Also ask for the estimated payment with and without points. A lower rate is not automatically better if the upfront fee takes longer than you expect to keep the loan to recover.
If you see Colonial 1st Mortgage in Richmond or Glen Allen directory results, verify its current licensing status through NMLS Consumer Access before making contact. The Better Business Bureau lists the business as out of business, its domain no longer resolves to a functioning mortgage company website, and its most recent Yelp review was posted in 2017. Current licensing and active contact information should always be verified.
Bank Statement Mortgage FAQs
1. Can I qualify with 12 months of bank statements?
Yes, some programs allow 12 months. Others use 24 months, which can help show consistency or average seasonal income.
2. What credit score do I need?
Some programs begin near 620 FICO, but borrowers with 660, 680, or higher generally have more options.
3. Can cash deposits count as income?
They may be difficult to use unless you can document the source clearly. Electronic, traceable deposits are usually easier to support.
4. Can I use business bank statements?
Yes. The program will normally apply an expense factor unless documented business expenses justify a different calculation.
5. How much down payment is required?
Requirements vary, but 10% is a common starting point. More down payment may improve terms and expand choices.
6. Do bank statement loans require reserves?
Usually. Three to 12 months of housing-payment reserves is common, based on the overall risk profile.
7. Is a soft credit pull a final approval?
No. It is an early planning tool. A full application and underwriting review are still required before final approval.
8. Can a bank statement mortgage be used to buy in Glen Allen?
Yes, subject to program guidelines, property eligibility, appraisal, documentation, and underwriting approval.
Legal disclaimer: This article is for educational purposes only and is not a commitment to extend credit or a guarantee of approval. Rates, fees, terms, guidelines, and program availability may change without notice. All loans are subject to credit, income, asset, property, appraisal, title, and underwriting requirements. Equal Housing Opportunity.
Start with a no credit hit mortgage application conversation while you still have time to organize deposits, compare payment structures, and shop Glen Allen homes with confidence instead of rushing to explain your income after the perfect home appears.
Duane Buziak, Mortgage Maestro | NMLS: 1110647 | Licensed in VA · FL · TN · GA | UWM PRO ELITE 2025 | UWM Top 20 Purchase LO Virginia 2025 | UWM Speed to Close Industry Leading 2025 | Scotsman Guide Top Originator 2025 & 2026 | VA Broker of the Year 2024-2025 | Top 1% Nationwide | Coast2Coast Mortgage | DuaneBuziakMortgageMaestro.com | duane@coast2coastml.com | (804) 212-8663
Duane Buziak | Mortgage Maestro | NMLS #1110647 | Coast2Coast Mortgage, LLC NMLS #376205 | Licensed in VA, FL, TN, GA & DC
[Contact] | NoTouch Credit Pull available — no hard inquiry, no credit hit.
