What is a Bank Statement Program?

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What is a Bank Statement Program?

You Need Options!

You are in search of a program that fits your specific needs. Maybe your bank has denied your loan request, or won’t give you the cash-out that you need for your business expenses, renovations or inventory purchases. In these situations, alternative lenders are now updating their offerings with more flexible options, including bank statement programs.

So, let’s start at the beginning…

What is a Bank Statement Program?

A bank statement program is an alternative loan solution that allows borrowers to waive presenting tax returns, pay stubs, W-2s and other employer verification forms. As a replacement for tax returns, they can simply provide bank statements as verification of income.

The underwriting method in traditional loans commonly calls for the lender to verify the applicant’s assets and earnings via reviewing their tax returns. The hassle with this method is that underwriters don’t necessarily get a whole picture of the borrower. Or maybe the borrower has had prior financial difficulties, and the improvement to the business is not quite reflected in the data.

A bank statement solution simply offers you an alternative option for proving your income.  For many small business owners, this option is more attractive and offers a way to move onto to more success financially.

Which Borrowers Benefit from This Solution?


Some borrowers need more flexibility and faster closings. Below are a few types of borrowers that may be a good fit for a bank statement solution.

  • Self-Employed
    Tax season comes for us all, and the way borrowers report income can seriously affect their chances at qualifying for a commercial loan. While individuals who work under an employer have a collection of pay stubs and receive a W-2 form at the end of the year reflecting their total earned income, self-employed professionals file their taxes differently and don’t have access to these documents.


That’s when a bank statement program is helpful because your client won’t need to provide tax returns to show proof of income. Instead, they can provide bank statements (generally 6 to 12 months) to the lender as income verification.

  • Borrowers who struggle to show consistent growth through tax returns
    Picture this: A small business owner runs a successful automotive shop and wants to refinance the mortgage on his property to make improvements to his business. The only problem standing between him, and the loan is a bankruptcy filed seven years ago that’s tainting his credit history.


Although this borrower currently has a booming business and is credit-worthy, he will likely struggle when looking to secure a refinance because of a) poor credit history and b) insufficient documentation due to his self-employment status.

Working with a non-bank lender that offers reduced documentation solutions like a bank statement program will allow this small business owner to finally secure that mortgage he’s been searching for. And remember – while these solutions offer more opportunities, you may need to pay a slightly higher interest rate. Fortunately, the cost of this type of loan is tax deductible.

  • Borrowers who require more flexibility than a bank is willing to provide
    Even if you can produce full documentation, you may still prefer to keep the process simple and only provide bank statements when applying for a commercial loan.


Partnering with a non-bank lender for a bank statement program also allows you to take advantage of other flexible options. Think less restrictive cash-out refinance options, a wider range of property eligibility (multifamily to automotive properties), and longer loan terms (15 to 30 years).

Let Reficashoutconnect.com help

Our process is simple – if you can’t produce tax return documentation, you can use 12 consecutive months of business bank statements as income verification. Work with expert underwriters that will use your bank statements to review and determine whether you are a fit for the bank statement option.

You need a lender that will apply an industry standard expense factor to determine the net income (the amount of money earned after paid taxes and business-related expenses) and the net cash flow available to cover the business, personal, and subject property debt obligations, and debt service coverage.

With this program and process, you can feel confident that you will receive the right solution for your financing needs.

Next Steps: Be the next success story

Now that you have a better idea on how a Bank Statement solution can fit your needs, you can get started by answering a few simple questions! Make sure to confirm your request by clicking the link in the email confirmation you’ll receive. Every request will be processed as a first-come, first-served order.

If you’re interested in creating a success story of your own,  get started by enter your email in the form on this page and clicking submit.