How a 24-Month Bank Statement Loan Works in an LLC

The Quick Read: A 24-month bank statement loan is reviewed on the average of two years of eligible deposits, minus an expense factor and any non-income credits, and the lender underwrites the borrower, not the LLC’s rent. The LLC usually matters for how the property is titled and which accounts are read as income. Occupancy decides how much of that is allowed.

• Qualifying income comes from deposit averages, with transfers, refunds and loan proceeds stripped out first.
• Business-account deposits carry an expense factor that varies by lender; no universal formula exists.
• Owner-occupied purchases generally do not allow LLC vesting. Rental properties often do, subject to program terms.
• Network programs typically ask for 12 months of statements. Some lenders prefer 24, and the longer window helps when revenue swings.
• A pure rental held in an LLC often fits a DSCR loan better, because that product tests the property instead of the borrower’s deposits.

What Is a 24-Month Bank Statement Loan?

It is an alternative-documentation mortgage for borrowers whose traditional personal-income documentation understates cash flow. Write-offs and deductions shrink taxable income. The lender looks at deposits instead of the return. A 24-month version simply stretches the lookback window to two years.

Across Lendmire’s wholesale network, the baseline documentation is 12 months of business or personal statements. Some lenders ask for 24. Others accept 24 when a borrower wants the longer average to carry the file. The borrower is reviewed on documented income under the applicable program, subject to lender guidelines. That is not a shortcut around underwriting. Every file still gets credit, reserves, leverage and property review.

Pricing runs higher than conventional financing, and a borrower who qualifies with traditional personal-income documentation should usually run that path first. A conventional or government-backed loan is likely the better choice for a borrower who qualifies, and finding a bank statement program often takes a broker. That is the gap a wholesale broker fills: one borrower, many program sheets.

How Does a Lender Turn Two Years of Deposits Into Income?

The lender builds income in a fixed sequence. Here is the sequence most programs follow.

1. Pick the window. Twelve months is the common baseline. Twenty-four months smooths a seasonal or lumpy business, because one weak stretch distorts a longer average less.

2. Identify the income accounts. Some programs read one account for the whole window. Others combine several. Program-specific, so the lender’s sheet controls.

3. Strip non-income credits. Transfers between your own accounts, refunds and loan proceeds come out. What is left is eligible deposits.

4. Average the remainder. Eligible deposits across the window are divided by the number of months.

5. Apply the expense factor. On business statements, the lender assumes a share of each deposit went to operating costs. Only the rest counts as income. A lender sets that share by business type, headcount and whether the business has a physical location. A supporting accountant letter can sometimes lower it. The exact factor is a lender decision, never a promise.

6. Prorate for ownership. If you own part of the LLC, only your share of the result counts.

7. Test against debts. Qualifying income is measured against the borrower’s total debts, including the new housing obligation.

Deposit scrutiny runs through the whole sequence. Underwriters check that deposits fit the business. A salon should show many small deposits, not a round lump. They also check consistency across the full window.

Where Does the LLC Actually Fit?

The LLC is usually the vehicle that holds title, not the income being underwritten. Most programs underwrite the owner, and the owner’s credit gets pulled. Where the LLC takes title or signs the note, members typically give personal guarantees, subject to program terms.

Occupancy sets the boundaries:

A home you live in points to a bank statement loan in your own name. A pure rental held in an LLC is a different conversation, covered later.

One more split matters. Say rent lands in the LLC’s account, while consulting income lands in a personal account. The bank statement lender reads the income accounts. It does not treat the LLC’s rent account as your income. Plenty of borrowers assume it does.

Personal, Business or Combined Statements?

The right statement set depends on how you are paid and how clean the accounts are.

Business statements get the expense factor. Personal statements usually do not, but they must show income actually earned, not transfers or loan proceeds. Commingled accounts are the common failure here. The underwriter cannot tell which deposits are income. Mixing personal and LLC money also weakens the liability protection the LLC was meant to provide, which is a separate reason to keep them apart.

12 Months or 24 Months?

Neither window hides a decline. A trend of falling deposits is a red flag in either case, and the lender will see it. If deposits have dropped across the window, a property-income loan may fit better than a deposit-based one. Lendmire’s piece In an LLC 12-Month Bank Statement Loan vs 24-Month Bank Statement Loan goes deeper on picking a window.

What Leverage and Loan Sizes Are Typical?

Program figures depend on occupancy and transaction type. The typical ranges through select lenders in the network look like this, subject to lender guidelines, credit and loan size:

• Primary residence, purchase or rate-and-term: up to 90% LTV. Stronger files earn the top of that range.
• Owner-occupied cash-out (primary or second home): up to 80% LTV with a fixed expense ratio, or 75% when the ratio is accountant-prepared.
• Investment property cash-out: tops out around 75% LTV.
• Investment property purchase: varies by lender, so treat it case by case.
• Asset-depletion alternative: up to about 80% LTV on a primary residence, qualifying from liquid assets instead of deposits.
• Loan amounts: roughly $125,000 to $3,500,000.
• Reserves: commonly around six months of the housing payment.

Never apply the 90% purchase ceiling to a cash-out. That mistake is common, and it gets files kicked back. For the investor-side leverage picture, the complete DSCR loans guide covers it.

Term length follows each lender’s program sheet. Forty-year and interest-only structures are DSCR-side offerings, so don’t expect them on a bank statement file.

Where Do These Files Break?

Documentation problems cause most failures, not the math. The usual ones:

• Commingled accounts. Personal and LLC activity in one account. Fix it well before applying, not during review.
• Large one-time deposits. A business sale or liquidity event is not income. It reads as a red flag that needs a written explanation.
• Declining deposits. Underwriters weigh the trend, not only the average.
• Time in business. Programs generally want about two years of operating history. Some lenders flex, so confirm the sheet.
• Multiple accounts. Sweep accounts, a separate payroll account and merchant-processor deposits need a clear map of which one carries income.
• Overdraft or NSF patterns. These raise questions about cash management and can stall a file.
• Ownership proof. Multi-member LLCs need operating agreements or similar documents showing your percentage.

Think of it as a cleanup window. The months before applying are when the accounts get sorted, not the week the file goes in.

Consider a hypothetical two-member LLC where the borrower owns 60%. Eligible deposits are averaged over 24 months. The lender applies an expense factor, then counts 60% of what remains. That share is tested against the borrower’s total debts. Raw deposits are never the qualifying income, and the result is always lower.

How Does Occupancy Change the Disclosure Rules?

Occupancy decides the regime. An owner-occupied bank statement loan, on a primary residence or second home, is a consumer mortgage, and TRID disclosures apply. A bank statement loan on a non-owner-occupied rental, including a short-term rental, is business-purpose and exempt from TRID.

The law keys on purpose. Under 12 CFR 1026.3 in the eCFR, credit extended primarily for a business or commercial purpose is exempt from Regulation Z. The CFPB’s commentary on the ability-to-repay section says that section does not apply to business-purpose credit, even when a dwelling secures it. The lender’s own purpose determination decides which side a file falls on. The borrower’s label does not. How the rule applies to a specific file is a compliance question, not a rule of thumb.

When Does a DSCR Loan Fit Better?

When the property is a pure rental, a DSCR loan often fits better. A DSCR loan is a business-purpose investor loan designed for non-owner-occupied properties. It qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Because it is a business-purpose product, it is reviewed differently from a standard owner-occupied mortgage.

The practical difference shows up at scale. A bank statement borrower adding a fifth rental runs into personal debt limits. Each DSCR property is reviewed on its own rent. Self-employed investors buying rentals can go either way, depending on how strong their deposits are against how strong the rent is.

LLC-held rentals also carry a program-eligibility qualifier: the entity must meet the lender’s requirements, depending on program guidelines.

Key Terms Defined

Eligible deposits: Deposits that remain after transfers, refunds and loan proceeds are removed.

Expense factor: The share of business deposits a lender assumes went to operating costs, set by the lender.

Vesting: How title to the property is held, whether in your name or an LLC.

Personal guarantee: A member’s personal promise to repay when an LLC is the borrower.

Non-QM: A mortgage that does not meet the Qualified Mortgage standard but still goes through underwriting.

Asset depletion: Qualifying from liquid assets instead of deposit averages.

What Does the Decision Look Like in Practice?

Start with occupancy. Then look at how the accounts are organized. If the home is yours to live in and your deposits are clean and steady, a bank statement file in your own name is the natural path. If the property is a rental in an LLC, compare it against a DSCR file. The stronger of the two numbers, deposits against rent, usually decides it.

Then check the paperwork. Two years of statements is a large data set, and it moves slowly through review. Fewer preventable gaps means fewer questions: clean accounts, ownership documents, written explanations for large deposits.

Putting It Together

Lendmire is a broker, arranging financing through select lenders in its wholesale network. Consumer-purpose bank statement loans are available in 16 states, and each file is underwritten individually. This is not a commitment to lend. Reach the team at 828-256-2183 or through the quote form.

Tax treatment can depend on how the funds are used and how the property is held; this is not legal or tax advice, so consult a qualified attorney or CPA about your own situation.

About Lendmire

Lendmire, NMLS# 2371349, is a non-QM mortgage broker that arranges financing for self-employed borrowers and real estate investors through select lenders in its wholesale network. Bank statement loans qualify on documented income under the applicable program, subject to lender guidelines, and consumer-purpose licensing covers 16 states. Separately, its DSCR investor loan programs, which qualify primarily on property-level rental income, run across 41 markets, including Washington, D.C. All scenarios remain subject to lender review and program guidelines, and nothing here is a commitment to lend. Lendmire has earned two consecutive Scotsman Guide Top Mortgage Workplace recognitions (2025, 2026).

References

1. eCFR, 12 CFR 1026.3 (Regulation Z exemptions)

2. CFPB, Regulation Z commentary on section 1026.43