Banks That Offer a Bank Statement HELOC as a Restaurant or Trades Owner

The Quick Read: Few large banks write this product. Most restaurant and trades owners reach it through non-bank lenders in a wholesale network, where a broker matches the file to a program. Approval depends on deposit quality, credit, equity, and the property, not on the lender’s brand.

• Tax write-offs can make a healthy business look thin on a return. A statement-based review looks at deposits instead.
• Under the wholesale programs Lendmire places files with, the ceiling on an investment property is 70% CLTV. The ceiling for a primary residence is higher, but only for the strongest credit profiles.
• The line is personal credit secured by your home. Your business cannot borrow it.
• Lenders qualify the payment on the full line, so a large limit raises your debt-to-income ratio even if you never draw it.
• Availability for this HELOC product is narrower than for DSCR loans, so ask early whether your state and property fit.

What Is a Bank Statement HELOC?

A bank statement HELOC is a home equity line of credit where the lender reads your income from deposits rather than tax returns. Equity is your home’s value minus what you owe on it. The line is revolving, so you borrow, repay, and borrow again within the limit.

The product is the same as any other line. Only the income-documentation path changes. A standard line leans on traditional personal-income documentation. The statement version looks at a year or two of business or personal deposits, depending on the program.

This matters to restaurant and trades owners for a simple reason. Their taxable income is often far lower than their actual cash flow. Equipment, vehicles, depreciation, and payroll all reduce what shows on a return. A deposit-based review measures the money moving through the account.

This is not a skip-the-paperwork loan. Income, credit, debt-to-income, equity, and title are all still reviewed, and each lender applies its own guidelines.

Who Actually Offers It? (A Lender-Type Answer)

You will not find a reliable national list of banks that offer this line, and Lendmire does not publish one. Programs change, and each lender sets its own documentation rules. What you can know is which kinds of lenders tend to write it.

Regulated depository institutions follow bank-regulator guidance on home equity lending. That guidance steers many of them toward full documentation. Non-QM lenders, meaning lenders outside standard mortgage rules, carry most statement-based programs. The best lender for you depends on your property type, credit profile, leverage need, and how your deposits look.

Lendmire is a mortgage broker, not a lender. It works with select wholesale HELOC lenders and matches a file to the program that fits. These home equity lines are available in Lendmire’s 16 full-service states. That is narrower than the 41-market footprint for DSCR investor loans, which includes Washington, D.C.

How Underwriting Treats Your Deposits, Step by Step

Underwriting turns raw deposits into one monthly income number. Then it tests that number against your debts, your equity, and your credit. Here is the usual sequence.

1. Choose the account type. The lender reviews business statements, personal statements, or both. Business statements usually take a haircut, and personal statements must show a clear pattern of business income.

2. Remove what is not income. Transfers between your own accounts, loan proceeds, and refunds come out. Large or irregular deposits draw written explanations.

3. Apply an expense factor on business accounts. This is the share of deposits assumed to cover business costs. The lender picks it based on the type of business, staffing, contractors, and how the business is structured.

4. Average the result across the statement period. That gives monthly qualifying income.

5. Run debt-to-income. Across the wholesale programs Lendmire places with, the maximum ratio is 50%. For credit profiles from 600 to 679 the limit drops to 45%, so anything above 45% requires a score of at least 680.

6. Qualify the payment on the full line. The test uses the interest-only payment calculated on the maximum draw, not your current balance.

7. Check equity, credit, and title. The home is the collateral. The lender confirms value, existing liens, and who holds title.

Step six surprises many owners. A $500,000 limit is tested as if you drew all of it. Bank-regulator guidance points the same way: interagency guidance on lines nearing the end of their draw periods tells lenders to evaluate the borrower’s willingness and ability to repay before extending a line or setting its repayment schedule.

What a Restaurant Owner’s Deposits Look Like to an Underwriter

Restaurants carry heavy food and labor costs, so the expense factor bites hard here. Deposits arrive in several forms: card settlements, cash drops, delivery-platform payouts, and catering invoices. Each needs to be traceable.

Seasonality is the next issue. A beachfront or tourist-season restaurant may show strong summer deposits and thin winters. A longer statement period smooths that out, but it also pulls in the weak months. Think about which window helps your file before you choose.

Mixing accounts creates trouble. If you pay staff and vendors from the same account that takes your own transfers, the statements get messy. Owner transfers in, tip pass-throughs, and cash deposited from home can all be questioned or excluded. A dedicated operating account makes the review cleaner.

One property point catches restaurant owners specifically. Mixed-use and commercial properties are not eligible for these lines. If you live above the restaurant, that building will not work as the collateral. Your separate residence might.

What a Trades Owner’s Deposits Look Like

Trades income comes in lumps. Progress payments land at project milestones, and slow-paying clients push deposits later. Material pass-throughs, subcontractor payments, and truck and equipment costs all affect how much of a deposit counts.

A contractor’s file raises its own questions. Which deposits are customer payments and which are reimbursements? How much goes out to subs? Is the business growing or shrinking? Clean job records and invoices help answer all three.

A CPA letter or profit-and-loss statement can support a lower expense factor where the program allows it. A lender may also ask for proof the business exists, such as a license or formation documents. Prepare these before you apply.

The Structures: Occupancy, Draw Periods, and Line Size

The line’s terms depend on how you use the home. The numbers below apply to the wholesale programs Lendmire places with. They are guidance ranges, subject to lender guidelines and full file review, not commitments.

CLTV, or combined loan-to-value, adds your existing mortgage and the new line together and divides by the home’s value. Lower credit tiers get lower ceilings. On a primary residence, a 700-plus profile reaches 85% CLTV up to $500,000, and a 660 profile also reaches 85% up to $500,000. A 620 profile drops to 70% up to $400,000.

A line above $500,000 is for primary residences only. It requires a credit profile of 700 or better (720 on the longer-runway structure described next) and caps at 75% CLTV. It also needs a full appraisal. Lines at or below $500,000 ordinarily use automated valuation, though a borrower can request a full appraisal.

Two draw structures exist on primary residences and second homes. One has a 3-year interest-only draw followed by a 17-year repayment. The other, the longer-runway structure, has a 5-year draw followed by a 25-year repayment. Investment lines use the 5-year structure only.

Three more mechanics apply. At least 75% of the line is drawn at closing. The line stays variable through both the draw and repayment periods and never converts to fixed. Each borrower is limited to three lines, and an owner of more than 15 financed properties is not eligible.

Where the General Rule Breaks

Rentals held in an LLC. Title must sit with you personally or in a revocable living trust. LLCs, corporations, partnerships, and land trusts cannot hold title. A rental already deeded to an LLC needs a vesting change, or a DSCR cash-out refinance instead, subject to program terms.

Property types. Single-family, 2-4 units, PUDs, townhomes, and condos, including non-warrantable condos, can work. Manufactured homes, co-ops, condotels, log homes, commercial, mixed-use, and agricultural zoning are not offered. Barndominiums are outside these programs as well.

Credit events. A bankruptcy needs four years of seasoning from discharge or dismissal. Foreclosure history splits by program. One path seasons a foreclosure at seven years, and the other declines that history regardless of age.

Listed properties. In several states, a home listed for sale in the past 60 days is ineligible. Your state may add its own overlays, so confirm before you plan around a draw.

Freezes and reductions. The line can shrink when you most need it. According to the CFPB’s explainer on home equity lines, a lender may refuse additional credit if your home’s value drops significantly. A restaurant or trades business often needs cash in a downturn, which is exactly when a freeze hurts. The same page uses a 10-year draw period as its example, while the wholesale programs here run shorter draws, so plan the repayment step early.

The simultaneous first mortgage. If you refinance your first lien at the same time, the new line’s payment can count in that file’s debt-to-income. Sequence the two deliberately.

Key Terms Defined

Bank statement HELOC: A home equity line that reads income from deposits instead of tax returns.

Expense factor: The share of business deposits a lender assumes goes to operating costs rather than your income.

CLTV: Your first mortgage plus the new line, divided by the home’s value.

Draw period: The stretch when you can borrow from the line, often interest-only.

Non-QM: A loan outside standard mortgage rules, using alternative documentation.

Open-end line: Credit you can repay and borrow again, unlike a closed-end loan paid down once.

How the Decision Looks in Practice

Start with the property you would pledge. A primary residence offers the widest leverage range and the largest lines. An investment property tops out at 70% CLTV and needs a 700 score. Pick the collateral before you pick a lender.

Next, think through how the line gets used. Many investors use equity to fund a down payment or rehab.

A HELOC and a DSCR loan answer different questions. A HELOC reads your income and debts. A DSCR loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. If your goal is buying a rental, the DSCR loan usually carries the purchase. The line may supply the down payment. Lendmire’s complete DSCR loans guide explains that side.

One coverage point deserves care. A DSCR above 1.00 means rent covers the mortgage payment, taxes, insurance, and any HOA dues. It does not mean positive cash flow. Repairs, vacancy, management, and utilities sit outside the ratio.

Use this preparation checklist before you apply:

• All pages of statements for each account you plan to use.
• A separate operating account, with owner transfers kept clearly labeled.
• Proof the business exists, such as a license or formation documents.
• A current mortgage statement and ID.
• A CPA letter or profit-and-loss statement, if the program accepts one.
• Written explanations ready for any large deposit.

Do not treat the line as your only reserve. Lines can freeze, and the repayment step brings larger payments. Keep other liquidity on hand.

Next Step

If you are considering a home equity line and want to see how the numbers work, Lendmire can help you compare HELOC options based on the property, the equity available, credit profile, combined leverage, and your goals. Lendmire arranges these lines through select wholesale lenders, and every figure here is subject to lender guidelines and full file review. This is not a commitment to lend.

About Lendmire

Lendmire — NMLS# 2371349 — is a mortgage broker that arranges home equity lines of credit in its 16 full-service states through wholesale lenders, on primary residences, second homes and investment properties. Every line is subject to the lender’s guidelines and full underwriting. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.

References

1. Federal Reserve – Interagency guidance on home equity lines of credit nearing their end-of-draw periods

2. CFPB’s explainer on home equity lines