What a P&L loan is — and isn't
It's also called a P&L-only loan, a P&L mortgage, or a profit and loss statement loan. The P&L replaces your tax returns; it isn't collected in addition to them.
It is not a bank-statement loan, where 12 to 24 months of deposits are analyzed line by line. No transactions are reviewed here.
Who this fits
- Business owners whose returns are optimized: depreciation, Section 179, vehicle and home-office deductions
- Owners who haven't filed — on extension, mid-year, or with a new entity that has no full tax year; a current-period P&L covers the gap
- Newly self-employed borrowers, or businesses that just turned a corner; on some programs a future income projection qualifies the loan
- Borrowers who aren't self-employed but can provide a P&L
The program in plain numbers
- Income documentation
- One P&L; no tax returns, bank statements, W-2s, or pay stubs
- Who prepares the P&L
- CPA-prepared (unaudited is fine); self-prepared and future-income-projection options on some programs
- Minimum loan amount
- $150,000
- Minimum credit (first position)
- 640
- Purchases
- 20% down at 680+; 25% down at 660–679; 30% down at 640–659
- Refinances (cash-out and rate-and-term)
- 75% LTV at 660+; 70% LTV at 640–659
- Second-position HELOC on a P&L
- 680+ credit
- Self-employment required?
- No
- Hard credit pull to see options
- Not required; soft review only
Under $150,000 or below 640, the routes are a bank-statement program (620+ in first position) or the standard 5-Day HELOC ($50,000 and up, no tax returns).
Pick your lane
- P&L-only loan
- The income file is…One P&L statement
- Minimums640+ credit, $150K+
- Best fitBusiness income a clean P&L presents better than returns or deposits
- Bank-statement loan
- The income file is…12–24 months of deposits, analyzed
- Minimums620+ first position, 660+ second
- Best fitSteady deposits, lower credit, or when no P&L exists
- True no doc HELOC
- The income file is…Nothing; credit and equity carry it
- Minimums680+ credit, $150K+ line
- Best fitStrong credit and equity, and no appetite for sharing financials
The pattern: stronger credit buys less paperwork.
Denied because of income?
A P&L re-argues a file that was denied on tax-return income, so bring the denial letter. If you owe less than half the home's value and need $150,000 or more, the stated-income paths may apply as well.
What you'll need
- The P&L
- A government-issued ID
- Your current mortgage statement, on a refinance
Joshua will give your CPA guidance on the format lenders expect before anything is prepared.
Good to know.
Does the P&L have to be CPA-prepared?+
CPA-prepared (unaudited is fine) fits the most programs and the best terms. Self-prepared P&Ls and future income projections are accepted on some programs.
Do I have to be self-employed?+
No.
I haven't filed my taxes. Can I qualify?+
Yes. A current-period P&L is used, and no return is requested.
What is a future income projection loan?+
An option on some P&L programs where the document projects income forward. It's for newly self-employed borrowers or fast-growing businesses.
P&L or bank statement?+
A P&L is better for seasonal revenue, many transfers, or co-mingled accounts, and it's more private. Bank statements are better for strong, steady deposits or credit in the 620s.
What are the LTV limits?+
Purchases: up to 80% LTV at 680+, 75% at 660–679, 70% at 640–659. Refinances: 75% at 660+, 70% at 640–659. Cash-out is that percentage of value minus what you owe.
Does checking hurt my credit?+
No. It's a soft review only.