The short answer: Yes. If your business occupies 51% or more of the building, you can buy or refinance it on 12 months of business bank statements, with no tax returns. Including tax returns disqualifies that file. The loan is available in 44 states (all except DE, HI, ND, SD, WV, WY).
Owners ask a version of the same question: the business deposits look healthy, and the tax return does not. Depreciation, equipment, and ordinary write-offs are supposed to lower taxable income. A bank that starts from that bottom line can still say no. The owner-occupied commercial real estate loan starts from the business deposits instead. Every program that skips tax returns is listed on commercial loans without tax returns.
Why a tax return can make a strong business look thin
The examples below are illustrative. They are not closed loans, not quotes, and not dollar outcomes from a real file.
Illustrative, a dentist. A dental practice can show steady patient deposits while depreciation on chairs, imaging, and the build-out pulls taxable income down. The bank-statement file does not start from that return. It starts from 12 months of the practice's business deposits.
Illustrative, a contractor. A contractor can have a full season of deposits and a return that looks modest after trucks, tools, and job costs. The occupancy test is still 51% or more of the building. The income test is still the deposit formula on the program page, not a reconstructed tax return.
Illustrative, a medical practice. A medical practice can look the same way: collections in the operating account, and a return shaped by equipment and ordinary expenses. None of these sketches is a deal Cressida Direct closed, and none of them states a loan amount or a payment.
How the bank-statement loan actually qualifies
Qualifying cash flow is 30% of average monthly business deposits, and that cash flow must cover debt service at a 1.15x DSCR. The minimum FICO is 650. Loans run from $200,000 to $3 million. A purchase can go to 80% loan-to-value. A refinance is capped at 75%. Borrowers are an individual, an LLC, or an S-corp. A partnership is not eligible. The rate is fixed for 5 or 30 years and the loan is fully amortized over 25 or 30 years, with no balloon. This article does not describe the period after a 5-year fixed rate. The prepayment penalty is 5-4-3-2-1. A typical file closes in 35–45 days. The published rate range on the program page is 8.25%–11.25%, and that range is not a quote.
The program page already shows an illustrative deposit example, labeled as an illustration and not an offer: twelve months of business deposits of $1,200,000 average $100,000 a month, and 30% of that average is $30,000 of qualifying cash flow, which must cover debt service at 1.15x. Use it to see the method. Do not treat it as someone's closed loan.
Cash-out refinance on bank statements
Yes, a cash-out refinance is a purpose of this loan. It is capped at 75% loan-to-value, and there are no restrictions on how the cash-out proceeds are used. The borrower must have owned the building at least 6 months. The same bank-statement test applies: 12 months of business deposits, 30% of the average monthly deposits, 1.15x debt service, and a 650 minimum FICO. A matured or defaulted loan is reviewed case by case, in some cases. That sentence is a review, not an approval.
What this loan is not
It is not a loan for a building the business does not occupy. That file is commercial DSCR loans, which qualify on the property's rent. It is not the tax-return program. Including tax returns disqualifies the bank-statement file. A separate tax-return program exists as an option, and this article does not restate its terms. Property types stay on the owner-occupied page: office, medical and dental, retail, light industrial and warehouse, mixed-use, automotive, restaurant and bar, day care, and self-storage.
Frequently asked questions
Can I buy my building if my tax returns understate my income?
Yes, if the business occupies 51% or more of the building. The owner-occupied loan uses 12 months of business bank statements and does not use tax returns. Including tax returns disqualifies that file. Qualifying cash flow is 30% of average monthly business deposits and must cover debt service at 1.15x. The minimum FICO is 650. Loans run from $200,000 to $3 million in 44 states.
Can I cash out refinance on bank statements?
Yes. A cash-out refinance is capped at 75% loan-to-value, and there are no restrictions on how the proceeds are used. The borrower must have owned the building at least 6 months. The file still uses 12 months of business bank statements, a 650 minimum FICO, and the 1.15x test on 30% of average monthly deposits. A typical close is 35–45 days.
What if the loan has already matured?
A matured or defaulted loan is reviewed case by case, in some cases. That review is not a promise of approval and not a commitment to lend. The refinance still requires at least 6 months of ownership and 12 months of business bank statements.
About the author
Chris Cleveland, Vice President, is a U.S. Navy veteran with 23 years in mortgage lending. He began in residential lending in 2003 and moved into commercial lending in 2007–2008. He works in English and Spanish. His published biography describes work across residential investment blanket loans, small-balance multifamily and mixed-use financing, and larger ground-up construction projects. Reach the team at 877.308.7557.
Illustrative examples are not closed loans. Terms are the ones published on the owner-occupied commercial page. This article is not a commitment to lend and not tax advice.