Michigan Bank Statement Loans for Self-Employed Borrowers
If you run a business in Michigan, your tax return probably tells a very selective story. You write off equipment, mileage, home office space, and health insurance because that is smart tax planning. Then a conventional lender reads your return and decides you barely earn enough to buy a starter home. Bank statement loans fix that mismatch by qualifying you on the deposits flowing into your accounts, which is the number that actually reflects how your business is doing.
Riverbank Finance LLC connects self-employed buyers with bank statement mortgage programs available through our lending partners, using 12 or 24 months of personal or business bank statements in place of tax returns, W-2s, or IRS transcripts. We serve borrowers across the state, from Grand Rapids to Detroit and everywhere in between.
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How do bank statement loans work?
A bank statement loan is a non-QM mortgage, which means the lender still verifies your ability to repay but does it with alternative documents. Instead of asking for two years of tax returns, the underwriter reviews 12 or 24 months of your bank statements and calculates a qualifying income from your actual deposits.
The math depends on which statements you use. With personal bank statements, the lender averages your eligible deposits over the statement period with no expense deduction. With business bank statements, the lender averages your deposits and then applies an expense factor to account for the cost of running your business. The default factor with most of our lending partners is 50%, so half of your average monthly deposits counts as income. If your business runs leaner than that, a letter from your CPA or tax preparer documenting your true expense ratio can raise the number that counts.
Certain deposits are excluded from the average no matter which program you choose. Transfers between your own accounts, loan proceeds, and one-off windfalls do not count as income, because they are not income. What the underwriter wants to see is consistent revenue landing in your account month after month.
Bank statement programs are built for people whose money moves through their bank accounts: business owners, freelancers, and self-employed professionals with multiple income sources. If you are an independent contractor paid by one or two companies that issue you 1099 forms, a Michigan 1099 loan may be a simpler fit, since it qualifies you directly on your 1099 earnings. Both programs are part of our broader Michigan non-QM loan lineup, and a loan officer can tell you quickly which one prices better for your situation.
For more information on bank statement loans call us at 800-555-2098 or apply online today!
Key Benefits of a Bank Statement Mortgage
- Qualify on Real Cash Flow: Your deposits show what your business actually brings in, not the income left over after every legal deduction. Your tax strategy should save you money, not cost you a house.
- No Tax Returns Required: No tax returns, W-2s, or IRS transcripts are needed to document your income. The statement file replaces all of it.
- Personal or Business Statements Accepted: Use whichever accounts best reflect your earnings. Business statements are allowed with as little as 50% ownership of the company on some programs, and personal statements with as little as 25% ownership.
- Flexible Property Types: Primary homes, second homes, and investment properties are all eligible, so the program works whether you are buying your family home in Grand Rapids or a rental up north.
- Larger Loan Amounts: Programs available through our lending partners go up to $3 million, with as little as 10% down and no mortgage insurance on some options for well-qualified borrowers.
Worried this sounds like a 2008-era stated income loan? It is not. Modern bank statement loans fully verify your income, they simply use your deposits to do it, and they comply with federal ability-to-repay rules. Check Your Options
Bank Statement Loan Requirements in Michigan
Guidelines vary by lender and are subject to change, but the programs available through our lending partners generally look for the following:
- 12 or 24 consecutive months of personal or business bank statements
- Credit scores from 600, with the strongest terms at 640 and above
- Down payment as low as 10% (up to 90% LTV) for qualified borrowers
- Roughly 2 years of self-employment history (some programs accept 1 year plus prior experience in the same industry)
- Cash reserves, typically 3 to 6 months of payments, up to 12 months on the largest loans
Lower credit scores and investment properties usually call for a larger down payment, with 15 to 20 percent being more typical outside the top credit tiers. Pricing on a bank statement mortgage depends on your credit score, down payment, and documentation type, and your loan officer can show you exactly how those levers move your terms.
Because these are non-QM programs, underwriting involves more judgment than a conventional file. That works in your favor when your finances are strong but unconventional. A good loan officer will package your statements so the underwriter sees the business you actually run.
Keep your deposits clean before you apply
Since your bank statements are the income file, treat them like one. In the months before you apply, avoid overdrafts and NSF fees, keep business and personal funds in separate accounts, and be ready to explain any large deposit that is not business revenue. Underwriters exclude transfers, loan proceeds, and windfalls from the income calculation, so a statement full of them makes your qualifying income look smaller than it is. Steady, consistent deposits qualify best.
Apply for a Bank Statement Loan in Michigan
Getting started takes one conversation. Call our team at 800-555-2098 and a licensed loan officer will review your situation, explain whether a 12 or 24 month statement program fits better, and outline the documents to gather.
You can also fill out the quote form above. We will review your information promptly and follow up with a clear picture of the bank statement programs you may qualify for, without pulling tax returns into the conversation.
Start Your Bank Statement Loan Application
How do lenders calculate income from bank statements?
With personal statements, the lender averages your eligible deposits over 12 or 24 months with no expense deduction. With business statements, the lender averages your deposits and applies an expense factor, typically 50%, to estimate net income. A CPA or tax preparer letter documenting a lower expense ratio can increase your qualifying income. Transfers between your own accounts, loan proceeds, and one-off large deposits are excluded.
Who qualifies for a bank statement loan in Michigan?
Self-employed borrowers, business owners, freelancers, and gig workers are the core fit. Most programs look for about 2 years of self-employment history, though some accept 1 year plus prior experience in the same industry, with credit scores starting around 600 to 640.
How much do I need to put down on a bank statement mortgage?
Programs available through our lending partners go up to 90% LTV, which means as little as 10% down for well-qualified borrowers. Down payments of 15 to 20 percent are more typical at lower credit scores or on investment properties.
Do bank statement loans have higher interest rates?
Usually somewhat higher than conventional rates, since the lender is accepting alternative documentation. For many self-employed buyers it is the difference between qualifying and not qualifying at all, and you can refinance into a conventional loan later once your tax returns support it.
Do NSF fees or large deposits hurt my application?
They can. Underwriters exclude deposits that are not business income, such as account transfers, loan proceeds, and windfalls, and repeated NSF fees raise questions about cash flow. Clean statements with consistent deposits qualify best, so tidy up your accounts in the months before you apply.
Can I use business bank statements if I have a business partner?
Yes. Some programs available through our lending partners allow business statements with as little as 50% ownership of the company. Your share of the deposits is what counts toward qualifying income.
Submit your information now and a licensed residential loan officer will contact you within 24 hours. If you need immediate assistance then please call us now at 800-555-2098!
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