Do Bank Statement Loans Require a CPA Letter?

The Quick Read: Usually not: a CPA letter is an optional add-on for most bank statement loans, most often used to replace the lender’s default expense factor on business-account files, and a few programs also ask for one to confirm how long you have been self-employed. Your lender’s program sheet makes the final call, so confirm it before you pay an accountant.

• A bank statement loan is reviewed on documented income under the applicable program, subject to lender guidelines. The lender averages your deposits over 12 months.
• On business statements, the lender trims deposits with an expense factor, because deposits are revenue, not profit.
• A CPA letter can swap the default factor for your real expense ratio. That helps only when your real costs are lower than the default.
• On personal-statement files, the letter usually has little to do.
• A DSCR loan on a rental never uses a CPA letter, because it qualifies primarily on property-level rental income covering the payment, subject to lender guidelines.

What Does a CPA Letter Actually Do on These Loans?

A CPA letter is a signed, dated statement from a CPA, enrolled agent, or qualifying tax preparer. On a bank statement file, it usually certifies what share of your business deposits goes to operating expenses. The lender can then use that ratio instead of its default factor.

Think of the default factor as a standard haircut. The lender cannot see your books, so it assumes a portion of every deposit is spent on the business. The letter lets you show the real number.

It is not a P&L (profit-and-loss statement), and it is not a tax return. It does not prove your income by itself. It supports one input in the income calculation.

Across the wholesale network Lendmire works with, most programs treat the letter as optional. A few lenders restrict it to business-account files. Others set a minimum on how low the factor can go, and each program sheet states its own. That variation is why you will read “required” on one website and “optional” on another. Both are describing real programs.

How Bank Statement Income Gets Calculated

The math is simple, and seeing it shows where the letter fits. Most programs follow these steps:

1. Pick the account type. You submit 12 months of business or personal statements.

2. Screen the deposits. Transfers between your own accounts, gifts, loan proceeds, and one-time asset sales are generally excluded.

3. Apply the expense factor on business accounts. The lender removes a share of deposits to account for costs. Personal-statement programs usually skip this step but want a clear pattern of business income.

4. Swap in the letter, if you have one and the program allows it. The CPA-certified ratio replaces the default.

5. Average it. The lender divides adjusted deposits by the number of months. That is your monthly qualifying income.

6. Test the rest of the file. Credit, reserves, and leverage matter here as on any alt-doc file.

Picture two borrowers with identical deposits. The first runs a consulting practice with a laptop and a home office, so costs are thin. A letter documenting that can raise qualifying income and the loan amount. The second owns a landscaping crew with trucks, payroll, and materials. Real costs may exceed the default, and a truthful letter could lower the income figure. For the second borrower, skipping the letter is often the better move.

When a Letter Helps, When It Doesn’t, and When It Hurts

The letter is a tool, not a ritual. Here is how it plays out by situation:

Three cases deserve extra attention.

The letter conflicts with your other documents. A ratio that does not square with your traditional personal-income documentation or statements can hurt the file. Underwriters reconcile everything. A letter that is vague, unsigned, or issued by someone without credentials draws questions rather than answering them.

Money moving in circles. Transfers between personal and business accounts can inflate deposits. Lenders strip them out, and a letter does not rescue deposits that fail the screen.

Platform income. If you earn from short-term rental platforms, the same choice applies: default factor or documented ratio. Which wins depends on your actual costs. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income.

The Other Reason a Lender May Ask for One

Some lenders request a CPA letter for a different purpose: to confirm that your business exists and how long you have run it. Many programs want about two years of self-employment history. The letter, a business license, or filing records can show it.

This is a different use from the expense-factor letter. A lender might need one, the other, both, or neither. When a loan officer says the file needs a CPA letter, ask which job it is doing. The answer tells you what the letter must say and whether another document could stand in.

What the Letter Should Say and Who Can Sign

A usable letter generally contains:

• The signer’s name, credential, and license or registration details
• Your name and the business name
• A statement that the signer prepares your returns or has reviewed your records
• The period covered
• The expense ratio, if that is the job of the letter
• A signature and date

Who can sign depends on the program. Many accept a CPA, enrolled agent, or licensed tax preparer. Some want the person who actually prepares your returns. A bookkeeper’s note generally does not count.

Some CPAs decline to certify an expense ratio because it feels like an attestation. If yours declines, you have fallbacks. You can use the default factor, or a program that accepts an accountant-prepared P&L. Or you can look at a personal-statement program, where the question may not arise.

When you ask your accountant, be specific. Tell them the lender needs the percentage of business deposits that went to operating costs over the statement period, and that it must match your filed returns. Vague requests produce vague letters. Lendmire has also written about how to write a CPA letter for a super jumbo bank statement loan, which helps if your loan is in that size range.

Does Any Rule Say You Need One?

No rule requires a CPA letter. The federal ability-to-repay standard, found in 12 CFR 1026.43 on the CFPB site, asks lenders for a reasonable, good-faith repayment determination. A lender must verify the income or assets it relies on, using reasonably reliable third-party records. Cornell’s copy of the rule lists financial institution records among the acceptable examples. That is the hook for bank-statement underwriting. A CPA letter is not listed as a mandate.

So the requirement comes from each lender and investor, not from the law. Trade commentary on non-QM underwriting for self-employed borrowers describes the same trade-off: more flexible documentation, with more judgment calls left to the lender.

Disclosure rules also follow occupancy. An owner-occupied bank statement file (primary residence or second home) is a consumer mortgage, and TRID disclosure rules apply. A bank statement loan on a non-owner-occupied rental, including a short-term rental, is business-purpose and exempt from TRID. Know which one your property is, because it shapes the paperwork you will see.

Leverage and Program Basics

Leverage on bank statement loans depends on what you are doing with the property. These are typical ranges through select lenders in Lendmire’s network, subject to lender guidelines, credit, and loan size:

• Primary residence, purchase or rate-term: up to 90% LTV (loan-to-value, the loan as a share of the property’s value). Stronger files earn the top of the range.
• Owner-occupied cash-out (primary or second home): up to 80% LTV with a fixed expense ratio, and 75% where the ratio is accountant-prepared. That is the cash-out ceiling, not the purchase ceiling. Notice that an accountant-prepared ratio can come with a lower leverage cap here.
• Investment-property cash-out: tops out around 75% LTV.
• Investment-property purchase on bank statements: varies by lender.
• Asset-depletion alternative: qualifying from liquid assets runs to about 80% LTV on a primary residence.
• Loan sizes: roughly $125,000 to $3,500,000, with reserves commonly around 6 months of the housing payment.

Term length follows each lender’s program sheet, so do not assume extended or interest-only structures on a bank statement file. Owner-occupied bank statement lending runs through Lendmire’s consumer mortgage licensing, which covers 16 states.

Bank Statement Loan or DSCR Loan for a Rental?

If you own rentals and run a business, you may have two paths. A bank statement loan is reviewed on your personal or business cash flow. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. DSCR means debt service coverage ratio: the property’s rent divided by its monthly obligation.

DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage.

In a DSCR file, your personal income is not the focus, so there is no expense factor and no CPA letter. If a rental’s rent covers its payment on its own, DSCR removes the question entirely. Programs below 1.00 coverage are available through select lenders in the network, though leverage and terms adjust. Lendmire arranges DSCR investor loans across 41 markets, including Washington, D.C.

The bank statement route fits when the property will not cover itself, such as a primary residence, or when you want to qualify on business cash flow instead. The complete DSCR loans guide covers how coverage-based qualification works.

Questions to Ask Before You Pay an Accountant

A letter costs money and effort. Confirm the need first. Ask your loan officer:

• Does this program accept a CPA letter, and for which account types?
• Is the letter replacing the default factor, proving self-employment, or both?
• Is there a minimum ratio the program will accept?
• Must the signer be my regular preparer?
• Would a P&L prepared by my accountant work instead?
• Does a letter change the maximum LTV on this file?

Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.

Key Terms Defined

CPA letter: A signed statement from a CPA, enrolled agent, or qualifying preparer that supports an expense ratio or confirms your business history.

Expense factor: The share of business deposits a lender removes to estimate costs before calculating qualifying income.

Deposit averaging: Adding up eligible deposits over the statement period and dividing by the number of months.

Non-QM: A loan that does not follow standard agency documentation rules and uses alternative documents instead.

LTV: Loan-to-value, the loan amount as a percentage of the property’s value.

DSCR: Debt service coverage ratio, a rental’s income divided by its monthly obligation.

Business-purpose loan: A loan for a non-owner-occupied investment property, reviewed differently from an owner-occupied mortgage.

Next Step

Reach the team at 828-256-2183 or request a quote. Every file is underwritten individually by the lender, and nothing here is a commitment to lend.

About Lendmire

Lendmire, NMLS# 2371349, is a mortgage brokerage focused on investor financing, arranging DSCR loans in 40 states plus Washington, D.C. — 41 markets total. Qualification is based on the property’s income rather than personal income documentation, subject to lender guidelines, making it a fit for LLC-held rentals and scaling portfolios. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.

References

1. CFPB – 12 CFR 1026.43

2. Cornell LII – 12 CFR 1026.43

3. CFS Review – Self-Employed Borrowers’ Income