A conventional loan uses tax returns and follows agency guidelines. A bank statement loan uses your account history and the lender's own guidelines. The better choice depends on how your tax return compares to your deposits and on your credit and property.
| Conventional | Bank statement | |
|---|---|---|
| Income source | Tax returns, usually two years | 12 or 24 months of statements |
| Guidelines | Agency standards | Lender or investor guidelines |
| Best for | Borrowers whose returns show strong profit | Borrowers whose deposits exceed the profit on returns |
| Flexibility | More standardized | More variation between programs |
| Pricing | Often the benchmark | Varies by program, credit and property |
Run the numbers both ways
If your return shows strong income, a conventional loan may be the simplest path. If deductions hide much of your cash flow, a statement program may fit better. A loan officer can compare them with you.
The cost question
Statement programs are more varied, and pricing differences depend on credit, property and program. We do not publish rates because they would not tell you anything about your own file. Ask for a quote on both options.
Related
Ready to talk it through?
Apply online or call. A loan officer will review your situation.
Frequently asked questions
Can I switch to a conventional loan later?
You can refinance when your tax returns show enough income, and many borrowers do. Costs and market conditions will affect the decision.