Five questions to ask a bank statement lender

Use the same loan scenario with each lender. Get each answer in writing before paying for an appraisal so you can compare the programs on the same terms.

Loan scenario

Question 1: What expense factor will you apply to the business deposits, and can a CPA letter reduce it?

The expense factor determines how much of the business deposits the lender treats as qualifying income.

Question 2: Do you recognize all qualifying personal-account deposits, and which deposits will you exclude?

Record the exact deposit categories the lender will count, remove, or require you to document.

Question 3: Will you calculate the file using both 12 and 24 months and identify which period produces more income?

Ask for both calculations when the lender offers both statement periods; the averages may not produce the same result.

Question 4: Does this program charge mortgage insurance with less than 20% down?

Published policies conflict, so confirm whether mortgage insurance applies and include it in the payment comparison.

Question 5: Does the proposed loan include a prepayment penalty, 40-year term, interest-only period, or negative amortization?

Record each feature separately; these terms can materially change the loan’s cost, payment, or balance over time.