# Bank Statement Loans in Tennessee: Requirements for Self-Employed Borrowers Canonical URL: https://valor.mortgage/bank-statement-loans/ Page title: Bank Statement Loans in Tennessee | Valor Mortgage How lenders turn 12 or 24 months of deposits into qualifying income, and the down payment, credit and history they look for. [Apply Now](https://app.valor.mortgage/) By [Christopher Armantrout](https://valor.mortgage/about-us/), Licensed Mortgage Loan Originator · NMLS [#1210804](https://www.nmlsconsumeraccess.org/EntityDetails.aspx/INDIVIDUAL/1210804) Last updated October 27, 2026 Checked against published 2026 non-QM investor guidelines · October 2026 Quick answer A bank statement loan lets self-employed borrowers qualify on 12 or 24 months of bank deposits instead of tax returns. Lenders typically want two years of self-employment, a credit score of 600 to 700, and 10%–20% down on a primary home, with debt-to-income up to 50%. Business deposits are reduced by an expense factor, often a flat 50%, or a lower figure documented by your CPA or tax preparer. Program ranges on this page were compiled in October 2026 from published 2026 guidelines of national non-QM investors (listed in the sources table). Bank statement programs are set by each lender, not a government agency. Program terms and eligibility are subject to lender guidelines and may change. At a glance: bank statement loans in Tennessee - **Statements:** 12 or 24 months, personal or business - **Expense factor:** fixed 50%, or a CPA/EA/CTEC-documented factor (10% minimum) - **Down payment:** from 10% on a primary home with 700+ credit - **Credit:** 600 to 700 minimum, depending on lender and loan-to-value - **Debt-to-income:** up to 50% (45% above 85% LTV) - **Self-employed:** 2 years, sometimes 1 with extra reserves; 25%+ ownership ## How do lenders calculate income from bank statements? - **Personal statements:** eligible deposits ÷ 12 or 24 months. Lenders usually want 2 months of separate business statements to show business and personal money aren’t mixed; otherwise the personal account is treated like a business account. - **Business statements:** eligible deposits × your ownership percentage × (1 − expense factor) ÷ 12 or 24. - **Expense factor:** a fixed 50% for any business type, or a lower factor stated by a CPA, enrolled agent or CTEC-registered preparer (usually at least 10%). Some lenders accept a third-party prepared P&L instead. - **Not counted:** transfers between your own accounts, loan proceeds, refunds and other one-off deposits; large unusual deposits need a written explanation. - **Overdrafts:** one 2026 guide allows no more than 3 NSF or overdraft items in 12 months, or 6 in 24. ## How much down payment and credit do you need? | Requirement | Common range in 2026 guidelines | |---|---| | Minimum credit score | 600 to 700; 90% LTV usually needs 700+ | | Primary home, purchase | Up to 85%–90% LTV (10%–15% down) | | Primary home, cash-out | Usually up to 80% | | Second home | Same as primary or about 5% lower | | Investment property | Usually 75%–85% LTV | | Debt-to-income | Up to 50%; 45% above 85% LTV | | Reserves | None to 6 months, depending on LTV and loan size; 12 months on the largest loans | | Bankruptcy, foreclosure or short sale | Commonly 36 to 48 months; some lenders accept 12–24 months with a lower LTV | Sources: MAXEX Non-QM Program Guide v13 (Jan 2026); LoanStream Non-QM Matrix (Aug 5, 2026); A&D Mortgage Product Matrix (Aug 31, 2026). Ranges vary by lender. Program terms and eligibility are subject to lender guidelines and may change. ## Who qualifies for a bank statement loan? - **Self-employed borrowers** who own at least 25% of the business (some lenders require more), including sole proprietors, LLC and S-corp owners, and independent contractors. - **Two years of self-employment**, documented with a business license, CPA letter or similar. Some lenders accept 1–2 years with extra reserves and two years in the same line of work. - **Any occupancy:** primary home, second home or investment property, with different LTV limits. - **1099 earners** can use a related “1099-only” program: one or two years of 1099s plus year-to-date proof, with an expense factor of at least 10%. Because these are consumer mortgages, the lender must still document your ability to repay under the federal [ability-to-repay rule](https://www.consumerfinance.gov/ask-cfpb/what-is-the-ability-to-repay-rule-en-1787/). Bank statements are the documentation. ## What does bank statement income look like for a Robertson County business owner? | Item | Amount | |---|---| | Eligible business deposits, last 12 months | $480,000 | | Ownership | 100% | | Expense factor (fixed) | 50% | | Qualifying monthly income | $480,000 × 50% ÷ 12 = $20,000 | | Same deposits with a CPA-documented 30% expense factor | $480,000 × 70% ÷ 12 = $28,000 | | Purchase price / down payment at 10% | $500,000 / $50,000 | Illustrative example only. Actual interest rates and APRs vary based on loan program, borrower qualifications, property, market conditions and other factors. Closing costs are not included. Subject to lender guidelines and may change. To try your own numbers, including the property tax for a specific Tennessee address, use the [Tennessee mortgage calculator](https://valor.mortgage/mortgage-calculator/). ## What are the catches with bank statement loans? - Rates and fees are generally higher than on a conventional loan, and you usually need more down. - Mixed business and personal spending in one account makes the math harder; separate accounts help. - Transfers, loans and one-time deposits are taken out, so qualifying income can come in lower than you expect. - Many lenders require the business to still be operating at closing, verified by a third party. - Once your tax returns show enough income, [refinancing into a conventional loan](https://valor.mortgage/rate-term/) may lower your costs, if you qualify at that time. ## Bank statement loan FAQ ### Is it better to use 12 or 24 months of bank statements? It depends on your deposits. If business has grown, 12 months usually shows more income. If the last year dipped, 24 months can average it out. Some lenders price the 12-month option slightly differently. Program terms are subject to lender guidelines and may change. ### What credit score do you need for a bank statement loan? Published 2026 guidelines start between 600 and 700. Lower scores usually mean a larger down payment, and the 90% loan-to-value tier generally needs 700 or higher. Program terms and eligibility are subject to lender guidelines and may change. ### How much do you need to put down on a bank statement loan? Usually 10% to 20% on a primary home, depending on your credit score and loan size, and 15% to 25% on an investment property. Some lenders require more for first-time homebuyers. Program terms and eligibility are subject to lender guidelines and may change. ### Can you get a bank statement loan with one year of self-employment? At some lenders, yes, usually with extra reserves and at least two years in the same line of work before going out on your own. Most programs want two years. Program terms and eligibility are subject to lender guidelines and may change. ### Can you use personal bank statements instead of business statements? Yes. Lenders can count 100% of eligible deposits on personal statements, but usually want two months of business statements showing the accounts are separate. If business income runs through your personal account, the lender applies an expense factor instead. ## Where these figures come from | Figure | Source | As of | |---|---|---| | Income method, expense factor, ownership, NSF limits, 1099 option, reserves | [MAXEX Non-QM Program Guide v13](https://www.maxex.com/wp-content/uploads/2026/05/Non-QM-Program-Guide-v13.pdf) | Jan 26, 2026 | | Credit and LTV grid, DTI, credit-event seasoning | [LoanStream Wholesale Non-QM Matrix](https://loanstreamwholesale.com/wp-content/uploads/2026/10/LSM-Non-QM-Matrix-08.05.26.pdf) | Effective Aug 5, 2026 | | Bank statement and 1099 maximum CLTV | [A&D Mortgage Product Matrix](https://admortgage.com/wp-content/uploads/Product_Matrix_Aug_31_2026.pdf) | Aug 31, 2026 | | Ability-to-repay rule | [CFPB, ability-to-repay rule](https://www.consumerfinance.gov/ask-cfpb/what-is-the-ability-to-repay-rule-en-1787/) | Retrieved Oct 27, 2026 | ## Related guides - [P&L loans](https://valor.mortgage/pl/), [non-QM loans](https://valor.mortgage/non-qm-loans/) and [DSCR loans](https://valor.mortgage/dscr-loans/). - [Conventional loans](https://valor.mortgage/conventional-loans/), if your tax returns qualify. - [Will changing jobs hurt your loan application?](https://valor.mortgage/will-changing-jobs-hurt-my-loan-application/) - Living in or moving to the Nashville area? Start with my [Nashville mortgage broker](https://valor.mortgage/nashville-mortgage-broker/) page. - [About Christopher Armantrout](https://valor.mortgage/about-us/), the licensed originator who wrote this page. [Call me at (615) 671-9178](tel:+16156719178). I’ll look at your tax returns and your deposits side by side and tell you which one qualifies you for more, and at what cost. If it’s after hours, [grab a time on my calendar](https://valor.mortgage/book-your-appointment/), or [start an application](https://valor.mortgage/purchase/) and I’ll review it and reach out with a plan. About the author [Christopher Armantrout](https://valor.mortgage/about-us/) Owner & Senior Loan Officer, Valor Mortgage NMLS #1210804 Christopher is a licensed Mortgage Loan Originator in the State of Tennessee and has been originating home loans since 2015. He founded Valor Mortgage in Springfield in 2019 and works with veterans, first-time buyers, self-employed borrowers, and families across Robertson County and Middle Tennessee. [More about Christopher](https://valor.mortgage/about-us/) [Verify this license on NMLS](https://www.nmlsconsumeraccess.org/EntityDetails.aspx/INDIVIDUAL/1210804) **Valor Mortgage, LLC** · Christopher Armantrout, Mortgage Loan Originator, NMLS #1210804 · Valor Mortgage, LLC is powered by Encore Lending Group, LLC, NMLS #1249911 · Licensed in Tennessee · Equal Housing Opportunity 724 S Main St, Springfield, TN 37172 · (615) 671-9178 · christopher@valor.mortgage · [NMLS Consumer Access](https://www.nmlsconsumeraccess.org/EntityDetails.aspx/INDIVIDUAL/1210804) The dollar figures on this page are illustrative examples for general information only and are not an offer, a rate quote, or a commitment to lend. Actual interest rates and APRs vary based on loan program, borrower qualifications, property, market conditions and other factors. Program fees, limits and terms are set by the agencies named above and change without notice; all loans are subject to credit approval, income verification and property appraisal. Not all applicants will qualify. --- ## Contact Valor Mortgage - Christopher Armantrout, Senior Loan Officer, NMLS #1210804 - Phone: [(615) 671-9178](tel:+16156719178) - Email: [christopher@valor.mortgage](mailto:christopher@valor.mortgage) - Office: 724 S Main St, Springfield, TN 37172 - [Book an appointment](https://valor.mortgage/book-your-appointment/) · [Apply online](https://valor.mortgage/home-application/) · [Contact page](https://valor.mortgage/contact-us/) Valor Mortgage, LLC is powered by Encore Lending Group, LLC, NMLS #1249911 ([NMLS Consumer Access](https://www.nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/1249911)). Christopher Armantrout, Loan Officer, NMLS #1210804. Licensed in Tennessee. Equal Housing Opportunity. All loan programs, rates, terms, and conditions are subject to change without notice. Loan approval is based on borrower qualification, credit review, income verification, and property eligibility. Not all applicants will qualify. Not a commitment to lend.