| Truss Financial Group

Key Takeaways

• Bank statement loans allow Texas self-employed borrowers to qualify using 12-24 months of deposit history instead of tax returns, making homeownership accessible despite tax write-offs.
• Minimum credit score requirements typically start at 620, with down payments ranging from 10-20% depending on loan amount and borrower qualifications.
• Texas entrepreneurs, business owners, and freelancers benefit most from these loans, particularly those in real estate, medical practices, technology, and service industries.
• Loan amounts range from $100,000 to $5 million with competitive interest rates typically just 0.25-0.75% higher than conventional mortgages.
• The application process takes 21-30 days on average, focusing on consistent deposit patterns rather than tax-reported income for qualification.

What Are Bank Statement Loans in Texas?

Bank statement loans are mortgage products designed for self-employed borrowers, freelancers, and business owners that use bank deposit history instead of tax returns to verify income. These loans allow applicants to qualify based on the cash flow shown in 12-24 months of bank statements rather than taxable income, which is often reduced by business deductions and write-offs.

For many self-employed Texans, standard tax documentation doesn't tell the complete story of your financial health. After legitimate business deductions and write-offs, your tax returns might show significantly less income than you actually bring home – creating an unfair barrier to homeownership.

Bank statement mortgages solve this problem by looking at your actual cash flow. Your lender analyzes 12-24 months of deposits to calculate a monthly income average that better reflects your true earning capacity.

These loans differ from traditional mortgages in several key ways:

• Income verification method: Traditional loans rely on tax returns and W-2s, while bank statement loans use your deposit history to determine income
• Qualification approach: Rather than focusing solely on taxable income, lenders evaluate consistent deposit patterns and business revenue
• Documentation requirements: Instead of extensive tax documentation, you'll provide bank statements and basic business paperwork
• Loan terms: While rates are competitive with conventional products, they typically run about 0.5-1% higher due to their specialized nature

Texas is particularly well-suited for bank statement lending given the state's entrepreneurial spirit and business-friendly environment. With over 3 million small businesses accounting for 99.8% of all Texas businesses, the Lone Star State ranks among the top in self-employment.

Texas Bank Statement Loan Options

12-Month Bank Statement Programs

Our 12-month bank statement programs offer the fastest path to qualification for Texas entrepreneurs and business owners. These streamlined options require just one year of banking history, making them ideal for newer businesses or recently self-employed Texans.

With 12-month programs, we analyze your most recent year of deposit activity to calculate your qualifying income. This approach works particularly well for Texas business owners who have experienced recent growth or increased profitability, as it focuses on your current financial situation rather than historical performance.

Key features of our Texas 12-month options include:

• Loan amounts up to $3 million for primary residences
• Down payments starting at 10% for loans under $1 million
• Competitive interest rates typically 0.25-0.75% above conventional rates
• Cash reserves requirement of 6-12 months depending on loan size
• Available for single-family homes, condos, townhomes, and 2-4 unit properties throughout Texas

These programs are particularly popular with Austin tech entrepreneurs, Dallas medical professionals, and Houston real estate investors who need faster qualification and have strong recent income history.

24-Month Bank Statement Options

Our 24-month bank statement options provide Texas business owners with maximum income flexibility by analyzing a full two years of banking activity. This expanded timeline often results in higher qualifying income, as seasonal fluctuations and business cycles are averaged over a longer period.

The 24-month approach works exceptionally well for Texas businesses with cyclical income patterns, like construction contractors dealing with seasonal demand, retail businesses with holiday fluctuations, or agricultural businesses affected by growing seasons.

Texas borrowers choosing 24-month programs benefit from:

• Loan amounts up to $5 million for primary homes
• Down payments as low as 10% for strong applicants
• Income calculation methods that can exclude irregular or one-time deposits
• Access to more aggressive debt-to-income ratios up to 50% in some cases
• Reduced documentation requirements for other aspects of your application

For established Texas business owners with consistent deposit patterns, the 24-month option often results in more favorable terms and higher qualifying income compared to 12-month programs.

Personal vs. Business Bank Statement Loans in Texas

Texas entrepreneurs have the flexibility to qualify using either personal or business bank statements, depending on how you structure your finances.

Personal Bank Statement Options: Perfect for sole proprietors and single-member LLCs where business and personal finances aren't strictly separated. We examine deposits into your personal accounts and typically apply a 50% expense factor to determine usable income – recognizing that not all deposits represent actual income. This option works well for Texas real estate agents, freelancers, and consultants who deposit earnings directly into personal accounts.

Business Bank Statement Options: Ideal for Texas business owners with formal business banking structures. We analyze your business deposits and apply either:

• A predetermined expense ratio based on your industry type (ranging from 25% for high-margin service businesses to 50% for retail or construction)
• Your actual expense ratio calculated from profit and loss statements

Many Texas professionals benefit from our business bank statement approach, including medical practices in Houston, technology firms in Austin, and professional service companies in Dallas-Fort Worth.

Combination Approach: For Texas business owners with complex financial structures, we offer hybrid qualification using both personal and business statements. This works particularly well when you pay yourself through regular draws or transfers rather than a formal salary.

The right approach depends on your specific business structure and banking practices. Our Texas mortgage specialists can review your situation and recommend the optimal bank statement strategy to maximize your purchasing power.

What are the benefits of Bank statement loans in Texas?

1. Qualify Based on Cash Flow, Not Tax Returns

Bank statement loans look at your actual money flow rather than taxable income. Lenders review 12-24 months of bank statements to calculate your average monthly income, giving you credit for the revenue that actually passes through your accounts before business deductions and write-offs.

2. Perfect Match for Texas's Business-Friendly Environment

Texas ranks among the nation's top states for small business owners and entrepreneurs. From tech startups in Austin to real estate investors in Dallas and energy consultants in Houston, the state's economic landscape is filled with self-employed professionals who benefit from these flexible loan programs.

3. Higher Loan Amounts for High-Value Texas Properties

Self-employed Texans with strong income can access loan amounts up to $3 million through bank statement programs. This is particularly valuable in hot Texas real estate markets where conventional loan limits might be insufficient for desirable properties.

4. Simplified Documentation Requirements

Bank statement loans require fewer documents than conventional mortgages. Texas borrowers typically don't need:

• Tax returns
• W-2 forms
• Employment verification letters
• IRS Form 4506-T

This streamlined process saves time and reduces paperwork for busy entrepreneurs.

5. Works Perfectly with Texas's No State Income Tax Advantage

With no state income tax, Texas already offers tax benefits to entrepreneurs. Bank statement loans complement this advantage by allowing self-employed Texans to maximize federal tax deductions without hurting their mortgage qualification chances.

What are Texas Bank Statement Loan Requirements

Bank statement loans in Texas typically require higher credit scores than conventional mortgages due to their non-traditional income verification methods. At Truss Financial Group, we offer bank statement programs with these credit requirements:

• 680+ credit score: Access to our most competitive rates and highest loan amounts (up to $5 million)
• 660-679 credit score: Slightly higher rates with loan amounts up to $2 million
• 620-659 credit score: Available with higher down payment requirements
• Below 620: Case-by-case consideration for borrowers with compensating factors like substantial assets or larger down payments

Unlike some Texas lenders who require 700+ scores for non-QM products, we take a more flexible approach to credit evaluation. Recent late payments on revolving debt have less impact than mortgage or auto loan delinquencies.

For Texas real estate investors using bank statement loans, we place greater emphasis on the property's income potential than on minor credit imperfections.

Down Payment Expectations for Texas Borrowers

Texas bank statement loans typically require more skin in the game than conventional loans:

• Primary residences: 10-15% minimum down payment (compared to 3-5% for conventional loans)
• Second homes: 15-20% minimum down payment
• Investment properties: 20-25% minimum down payment

Down payment requirements vary based on several factors:

• Credit score: Stronger credit profiles can qualify for lower down payments
• Loan amount: Jumbo loans over $1 million typically require at least 20% down
• Property type: Single-family homes require less down than condos or multi-family properties
• Cash reserves: More liquid assets can sometimes offset down payment requirements

For Texas borrowers with substantial assets but limited liquidity, we offer asset depletion options that can be combined with bank statement qualification to reduce down payment requirements.

What is Required Documentation for Texas Bank Statement Loans

While bank statement loans eliminate the need for tax returns, they still require specific documentation:

Essential Documents:

• 12 or 24 months of bank statements (personal, business, or both)
• Government-issued photo ID
• Proof of business existence (business license, CPA letter, or professional website)
• Property information (purchase contract for buys, current mortgage statement for refinances)
• Proof of down payment funds and reserves
• Explanation for any unusual deposits

Additional Documentation That May Be Required:

• Business entity paperwork (LLC agreement, articles of incorporation)
• Profit and loss statement (self-prepared is acceptable for most programs)
• Proof of self-employment for at least 2 years
• Mortgage statements for other properties owned
• Texas-specific homeowner insurance requirements, especially for coastal areas

Unlike traditional loans, we don't require tax returns, W-2s, or employment verification for our bank statement programs. The focus remains on your deposit history and banking patterns.

Property Types Eligible in Texas

Bank statement loans can be used to purchase various property types across Texas:

Eligible Primary Residences:

• Single-family homes
• Townhouses and row homes
• Condominiums (both warrantable and non-warrantable)
• 2-4 unit properties (where you occupy one unit)
• Planned Unit Developments (PUDs)

Eligible Investment Properties:

• Single-family rental homes
• Multi-family properties (up to 4 units)
• Vacation rentals and short-term rental properties
• Some commercial mixed-use properties (with residential component)

Texas-Specific Considerations:

• Properties in coastal areas may require additional wind/hail insurance
• Flood zone properties require flood insurance certification
• Rural properties may need well/septic inspections
• HOA-governed properties require association documentation review

Maximum loan amounts vary by county, with higher limits available in high-cost areas like Austin and parts of Dallas-Fort Worth. Our bank statement programs can accommodate loan amounts from $100,000 up to $5 million for qualified borrowers, making them suitable for everything from starter homes to luxury properties across Texas.

Who should consider Texas Bank Statement Loans?

Self-Employed Texas Professionals

Texas leads the nation in self-employment growth, with professionals across numerous industries choosing independence over traditional employment. Bank statement loans provide a crucial mortgage pathway for:

• Medical professionals with private practices in the Texas Medical Center or growing suburban communities
• Attorneys and legal consultants throughout Dallas-Fort Worth who take cases on contingency
• Oil and gas consultants in Houston and West Texas with fluctuating but substantial income
• Technology specialists and IT consultants in Austin's booming tech corridor
• Architects and engineers working on Texas' massive construction and infrastructure projects

These professionals often show lower taxable income on paper than their actual earnings due to legitimate business deductions. While traditional lenders see this as risky, bank statement loans recognize your true cash flow, giving you access to the Texas home you deserve based on your actual income.

Most importantly, these loans allow you to maintain your tax advantages without sacrificing your homeownership goals – a critical balance for Texas professionals with established practices.

Texas Small Business Owners

Texas ranks consistently among the top states for small business growth, with over 3 million small businesses employing nearly half the state's private workforce. Bank statement loans offer Texas business owners significant advantages:

• Retail shop owners in San Antonio's growing commercial districts can qualify based on consistent store revenue rather than tax returns
• Restaurant owners throughout Texas can use deposit history rather than reported profit
• Service business owners in Houston's diverse commercial landscape can leverage actual cash flow
• Construction company owners in Dallas-Fort Worth's booming market can qualify despite seasonal income fluctuations
• Family-owned businesses throughout Texas can separate personal finances from business assets

Texas business owners frequently reinvest profits into their companies, purchase equipment, or expand operations – all strategies that reduce taxable income but strengthen their businesses. Bank statement loans recognize this reality by focusing on your deposit history rather than tax documents.

Texas Freelancers and Gig Economy Workers

The gig economy has transformed the Texas employment landscape, with cities like Austin ranking among the nation's highest for independent worker concentration. Bank statement loans serve:

• Rideshare drivers in Houston, Dallas, and Austin working across multiple platforms
• Vacation rental hosts in popular Texas tourist destinations
• Creative professionals throughout Texas' entertainment and media markets
• Contract programmers and developers in the Texas technology corridor
• Skilled tradespeople serving Texas' residential construction boom
• Online sellers and e-commerce entrepreneurs across the state

Traditional lenders struggle with variable income patterns, but bank statement loans excel by evaluating your consistent deposit history rather than requiring steady paychecks. For Texas gig workers who capitalize on our state's strong tourism, technology, and service industries, these loans provide access to homeownership that might otherwise be unattainable.

The flexibility to combine income sources – a critical feature for many Texas freelancers working across multiple platforms or clients – sets these loans apart from conventional mortgage options.

Real Estate Investors in Texas Markets

Real estate investors face unique financing challenges – their income often appears on paper as significantly less than reality due to depreciation, expense write-offs, and 1031 exchanges. Bank statement loans cut through these complications by focusing on actual cash flow rather than taxable income.

These loans can be particularly valuable for investors expanding their Texas portfolios who might otherwise hit conventional financing limits. Whether you're building a long-term rental portfolio in stable Texas markets or capitalizing on the state's strong appreciation trends, bank statement loans provide financing flexibility that traditional programs simply can't match.

The Texas Bank Statement Loan Process

Application Steps for Texas Borrowers

The bank statement loan application process in Texas follows a straightforward path designed to minimize paperwork while thoroughly evaluating your financial situation:

1. Initial Consultation: We start with a conversation about your specific needs, property goals, and business structure to determine if a bank statement loan fits your situation.
2. Pre-Qualification: Submit basic information about your income, assets, and credit profile to receive a preliminary approval amount and rate range before house hunting.
3. Documentation Collection: Gather and submit your bank statements (12 or 24 months depending on program), business verification documents, and property information once you've found your Texas home.
4. Formal Application: Complete our streamlined application, which focuses on your actual cash flow rather than tax-reported income – a crucial difference from conventional Texas mortgage applications.
5. Property Evaluation: The property undergoes an appraisal by a Texas-licensed appraiser who understands local market conditions across different regions of the state.
6. Underwriting Review: Our Texas-based underwriting team reviews your complete file, focusing on deposit consistency and business stability rather than tax-based debt-to-income calculations.
7. Closing Preparation: Work with a Texas title company (not attorneys, as is common in other states) to prepare closing documents in compliance with Texas homestead laws.
8. Final Closing: Attend your closing appointment at the title company office to sign documents and receive your keys.

Unlike conventional mortgages, the entire process typically requires far fewer documents and avoids the extensive tax history review that often delays mortgage closings for self-employed Texans.

How Your Bank Statements Are Evaluated?

The evaluation of your bank statements follows a methodical process designed to accurately capture your true income:

For Personal Bank Statements:

• We analyze personal account deposits over your chosen period (12 or 24 months)
• Large, irregular deposits are identified and may require explanation
• We exclude transfers between accounts, loan proceeds, and other non-income deposits
• A standard expense ratio (typically 50%) is applied to determine usable income
• Average monthly income is calculated based on consistent deposit patterns

For Business Bank Statements:

• We review your business operating account deposits
• Industry-specific expense ratios are applied (ranging from 25% to 50% based on business type)
• Texas service businesses typically qualify for more favorable expense ratios than retail
• Business transfers to personal accounts are analyzed to establish income patterns
• Seasonal fluctuations common in Texas construction, tourism, and agricultural businesses are accounted for appropriately

Unlike conventional loans that focus primarily on tax returns, our evaluation process recognizes the legitimate business deductions that often reduce taxable income for Texas entrepreneurs. We're looking for consistency and stability in your deposits rather than maximum reported income.

Special attention is given to Texas-specific business cycles – whether you're in Houston's energy sector with its unique rhythms, seasonal tourist businesses along the Gulf Coast, or agricultural operations affected by Texas growing seasons.

Texas Approval Timeline and Expectations

The timeline for a Texas bank statement loan typically moves faster than conventional financing:

• Pre-qualification: 24-48 hours after initial information submission
• Formal application to conditional approval: 5-7 business days
• Appraisal process: 7-10 days (can vary by Texas region; rural
• Appraisal process: 7-10 days (can vary by Texas region; rural properties may take longer)
• Conditional approval to final approval: 3-5 business days
• Clear to close: 1-2 business days after final approval
• Total typical timeline: 21-30 days from full application to closing

This expedited process compares favorably to the 45+ days often required for conventional loans for self-employed borrowers. The key difference is our focused evaluation of bank deposits rather than extensive tax documentation review.

Texas closings have unique features that affect timeline expectations:• Texas requires closing at title companies rather than with attorneys• Our state's homestead laws require specific disclosure timing requirements• Texas title insurance rates are state-regulated and identical across all providers• Community property considerations may require spousal documentation even for separately purchased properties

During the process, expect regular communication from our team about your loan status, any additional documentation needs, and preparation for your closing date. We prioritize transparency about potential timeline impacts specific to your situation and property location within Texas.

Texas Areas We Serve with Bank Statement Loans

We offer bank statement mortgage solutions throughout the Lone Star State, focusing on both major urban centers and the growing communities that make Texas such a dynamic market for homebuyers and investors.

Major Metropolitan Areas:

• Dallas-Fort Worth: From downtown luxury condos to suburban family homes in Plano, Frisco, and Allen
• Houston: Serving the entire metro area including The Woodlands, Sugar Land, and Katy
• Austin: Supporting self-employed professionals in Austin's booming tech corridor and surrounding communities
• San Antonio: Providing financing solutions from downtown to rapidly growing suburbs like New Braunfels
• El Paso: Helping border region entrepreneurs achieve homeownership

Growing Communities Across Texas:

• Central Texas: Serving Waco, Temple, and College Station
• East Texas: Supporting Tyler, Longview, and Texarkana
• Gulf Coast: Financing in Corpus Christi, Galveston, and Victoria
• West Texas: Providing loans in Midland, Odessa, and San Angelo
• Rio Grande Valley: Serving McAllen, Edinburg, and Brownsville
• North Texas: Supporting Denton, Sherman, and Wichita Falls
• Hill Country: Financing in New Braunfels, San Marcos, and Fredericksburg

We understand the unique market conditions and property values across different Texas regions, allowing us to provide tailored bank statement loan solutions no matter where you're buying or investing.

Apply for a Texas Bank Statement Loan Today

Ready to leverage your actual income instead of tax returns? Take the first step toward Texas homeownership with a bank statement loan tailored to your self-employment situation.

Don't let traditional income verification requirements stand between you and your Texas dream home. Our experienced loan officers understand self-employment and will guide you through every step of the bank statement loan process.

Apply now and discover how much home you can afford based on your actual income, not just what shows on your tax returns.

Frequently Asked Questions: Texas Bank Statement Loans

How many months of statements do I need in Texas?

Most Texas bank statement loan programs require either 12 or 24 months of statements. Our 12-month option works well for borrowers with stable recent deposits, while 24-month programs often benefit those with seasonal or fluctuating income by providing a more complete financial picture.

What interest rates can I expect in the Texas market?

Texas bank statement loan rates typically run 0.5% to 1.5% higher than conventional mortgage rates. Factors affecting your specific rate include credit score, down payment amount, loan size, and whether you're using personal or business statements. Most qualified borrowers currently secure rates between 6.5% and 8.5%.

Can I refinance my existing Texas mortgage with a bank statement loan?

Yes, bank statement loans are excellent refinancing tools for Texas homeowners who've become self-employed since their original mortgage or whose business has grown substantially. This option allows you to potentially lower your rate, change your term, or access equity without meeting traditional income verification requirements.

Are Texas bank statement loans available for investment properties?

Absolutely. Texas real estate investors frequently use bank statement loans to finance rental properties, vacation homes, and fix-and-flip projects. Investment properties typically require a down payment of 20-25% and slightly higher interest rates than owner-occupied homes, but follow the same income verification process using your deposit history.