The Quick Read: Most large retail banks write home equity lines only on full tax-return documentation, so a bank statement line for a commission earner usually comes through specialty wholesale lenders that read deposits as income. A broker with access to several of those lenders matches the file to the program.
- Deposit-based income review changes only how your income is proven. Credit, combined leverage, debt load and property rules still apply.
- Occupancy sets the ceiling. An investment-property line tops out at 70% CLTV, while a primary residence can reach 90% CLTV at a 720 credit profile.
- The line sits behind or beside your first mortgage, and your home is the collateral.
- LLCs cannot hold title on these lines. A rental held in an LLC usually points to a DSCR cash-out refinance instead.
- Every figure here is subject to lender guidelines and full file review. Nothing here is a commitment to lend.
The title asks which banks. The honest answer is a category, not a roster. Lendmire is a mortgage broker, not a lender, and it does not rank or name institutions. What follows explains how these lenders think, what the programs look like, and how to tell whether a line or a DSCR loan fits your commission income.
How large a line the equity supports.
An equity line is sized by combined loan-to-value, occupancy, and credit — not by rental coverage. Switch the occupancy or the credit band and the ceiling moves with it.
Investment-property lines require a 700 minimum credit score; second-home lines start at a 640 minimum and primary-residence lines at 600, and the combined-LTV ceiling steps down as the credit band drops on primary-residence and second-home lines and holds on investment-property lines; the line cap steps down on primary-residence lines and holds at every tier on investment-property and second-home lines.
A debt-to-income ratio above 45% requires 680+ credit. Profiles under 640 are limited to single-family homes. At least 75% of the approved line is drawn at closing. Ceilings, floors, and caps update from Lendmire’s centralized guideline source.
Line estimate
Illustrative estimate only — not a quote, Loan Estimate, approval, or commitment to lend. The rate is an editable assumption; equity-line pricing is variable through both the draw and repayment periods and never converts to fixed. Occupancy and credit drive the ceiling together: an investment property tops out at 70% combined LTV (minimum credit 700, line cap $500,000); a second home tops out at 90% combined LTV (minimum credit 640, line cap $500,000), with the ceiling stepping down as the credit band drops (the cap holds at every tier); a primary residence tops out at 90% combined LTV (minimum credit 600), and its $750,000 maximum line is available only at 75% combined LTV or below with a 700-or-better credit profile (720 on the longer-runway program) and a full appraisal. Lines above $500,000 require a full appraisal. Credit, debt-to-income, property type, and full underwriting review all affect the final line.
What Is a Bank Statement HELOC?
A bank statement HELOC is a home equity line of credit where the lender estimates your income from deposits in your accounts instead of from tax-return net income. The label is a market term. It describes the documentation method, not a separate type of credit.
The CFPB describes a home equity line of credit as an open-end line that lets you borrow repeatedly against your home equity. It has a draw period, then a repayment period. If you fall behind, the home is at risk.
The bank statement part comes from non-QM lending. Non-QM means a loan outside the standard mortgage box. HousingWire’s non-QM guide explains that these programs verify income through actual deposits and that a business account typically gets an expense factor applied. It also reports that bank-statement loans made up about 34% of a roughly $239 billion non-QM market in a recent year. DSCR loans made up 29%.
That tells you deposit-based review is mainstream for first mortgages. It does not mean many banks apply it to equity lines.
Why Commission Income Trips Up Standard Underwriting
A 1099 reports gross payments before any expenses. Traditional underwriting, by contrast, is based on net income after deductions. A commission earner who writes off car costs, marketing and office space can look much smaller on paper than the cash that moves through the account.
Commissions also arrive in lumps. One closing might cover several months of living costs. A single month of statements says little, so deposit-based review averages across a longer window.
Self-employed status is broader than people expect. Freelancers, contractors paid on a 1099 and owners of a business all land in the same bucket. The baseline credit, debt and equity minimums stay the same as for a salaried borrower. Only the proof of income changes.
Why So Few Banks Write This Product
Large retail banks usually keep their equity lines in their own portfolio and set their own income rules. Many only accept full documentation. A deposit-based equity line is a specialty product, so it sits mostly with niche and wholesale lenders.
Lendmire works with a network of wholesale HELOC lenders and shops a scenario across them. Which lender writes your file depends on your property type, credit profile, leverage need and documentation. The right program for your situation may not be the one with the loosest income review, because the same lender sets the credit, title and property rules too.
How Underwriting Treats Your Deposits, Step by Step
Here is how a deposit-based review generally runs. Individual lenders vary in the details.
1. Classification. A commission-only agent, broker or sales rep paid on a 1099 is self-employed. That choice sends the file down a self-employed documentation path.
2. Documentation lane. Lenders offer several lanes: full tax returns, bank statements, a profit-and-loss statement or CPA letter, or assets. A borrower picks the lane that shows the strongest honest picture.
3. Statement pull. The lender collects consecutive statements from the account where commissions land. Market surveys of non-QM bank-statement lending commonly report lookbacks of 12 to 24 months, per HousingWire. Each lender sets its own window.
4. Deposit scrub. Underwriters pull out transfers between your own accounts, loan proceeds and one-time asset sales. Those items lower the usable total.
5. Income calculation. Eligible deposits are averaged over the lookback. A business account gets an expense factor, because deposits are not profit. A personal account is usually treated more directly, since the money has already cleared the business.
6. Rest of the file. Credit, combined loan-to-value, debt-to-income, valuation and title all run in parallel.
7. Decision. The cleaned income, the first-mortgage balance, credit and the property’s occupancy type drive the outcome.
Consider a scenario with two commission earners who each deposit the same gross amount. One sends everything through a business account, so a large expense factor trims the income. The other deposits into a personal account and gets a more direct read. Same work, different income number, which is why statement preparation matters before you apply.
Matching deposits to your 1099-NEC or 1099-MISC forms also helps. A split commission can show a smaller 1099 total than the deposits received, so a short written income narrative that explains the difference is worth including.
What the Wholesale Programs Look Like
Across the wholesale network, the equity line is a standalone first- or second-lien product. Two draw structures exist on primary residences and second homes. The 3-year-draw structure pairs three years of interest-only draw with a 17-year fully amortizing repayment, while the 5-year-draw structure pairs five years of interest-only draw with a 25-year fully amortizing repayment. Investment lines run the 5-year-draw structure only. Pricing floats during both phases and never converts to fixed.
The line size runs from $25,000 up to $750,000. At least 75% of the line is drawn at closing. After closing, the minimum subsequent draw is generally $1,000.
Leverage depends on occupancy and credit. Here are the ceilings, each tied to its property use:
| Occupancy | Top CLTV | Credit needed | Max line |
|---|---|---|---|
| Primary residence | 90% | 720+ | $500,000 |
| Primary residence | 75% | 700+ (720 on the longer-runway program) | $750,000 |
| Second home | 90% | 720+ | $500,000 |
| Investment property | 70% | 700+ | $500,000 |
The 90% ceiling exists only at a 720-or-better credit profile, and lower tiers step down from there. The table shows the credit needed for each top ceiling, not the program floor. The minimum credit score is 600 on a primary residence, 640 on a second home and 700 on an investment line. On this network, an investment line stops at 70% CLTV.
Other terms to expect:
- Debt-to-income: 50% maximum, 45% for credit profiles from 600 to 679, and a ratio above 45% needs at least a 680 score. The payment is qualified on the interest-only amount at the maximum draw, so an undrawn line still counts against you.
- Valuation: lines of $500,000 or less ordinarily use an automated valuation, though a higher CLTV may call for a second look. Every line above $500,000 needs a full appraisal, and any borrower may request one.
- Larger lines: anything above $500,000 sits on a primary residence only, with the 75% ceiling already noted. It needs credit of 700 or better (720 on the 5-year-draw structure).
- Exposure: a borrower is limited to three lines, and an owner of more than 15 financed properties is not eligible.
- Property types: single-family, 2-4 units, PUDs, townhomes and condominiums, including non-warrantable condos. Manufactured homes, co-ops, condotels, log homes, commercial and mixed-use properties are not offered.
- Availability: the equity-line program is offered in Lendmire’s 16 full-service states, which is narrower than its DSCR footprint of 41 markets, including Washington, D.C.
Credit history also carries weight. A bankruptcy needs four years of seasoning from discharge or dismissal. Foreclosure history splits by structure, and some lenders decline it outright on primary residences and second homes.
Where the General Rule Breaks
Rental properties. A line against a rental is the hardest version. Many lenders decline non-owner-occupied lines because they see tenant-payment risk. Where an investment line is available, it carries the 70% CLTV ceiling and a 700 credit minimum shown above.
Title. The line must be held by you personally or by a revocable living trust. LLCs, corporations, partnerships and irrevocable, blind or land trusts cannot hold title. A rental already deeded to an LLC needs a vesting change before a line can work, or you move to a DSCR cash-out instead. That is the sharpest structural difference between the two products.
Using your own home to fund rentals. Another route is to borrow against your residence instead. The line is secured by your residence rather than the rental, so the primary-residence ceilings apply. The tradeoff is real: the CFPB’s HELOC booklet explains that the credit limit is set as a percentage of the home’s value less what you owe, and your home is the collateral.
Mixed income. A borrower with W-2 pay plus 1099 commissions can often combine documentation types. A recent switch from W-2 to 1099 work in the same field gets a harder look, since lenders want prior industry experience and steady deposits.
Listed properties. A property listed for sale, or listed within the past 60 days, is ineligible in several states. Programs also differ on that point.
Where DSCR Becomes the Better Tool
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.
DSCR means debt service coverage ratio. The lender divides the property’s rent by its full monthly obligation: principal, interest, taxes, insurance and any HOA dues. The loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. The complete DSCR loans guide walks through the math in detail.
The network ranges for a DSCR cash-out refinance on a standard rental run as follows.
- Leverage tops out around 75% LTV, with roughly six months of seasoning as the common expectation.
- A coverage ratio of 1.00 is where select programs start. A separate select-lender path takes coverage below 1.00 with leverage and terms adjusted.
- Credit floors begin at 620 in parts of the network, and most programs want around 660. A 700-plus score unlocks the strongest leverage tiers.
- Reserves commonly run around six months of PITIA, though they vary by lender, leverage, loan size and transaction type.
- Standard loan sizes reach up to $3,000,000 on standard programs, with smaller balances available through select lenders. LLC vesting is allowed, subject to program terms.
Clearing 1.00 does not mean the property produces positive cash flow. DSCR compares rent to the payment only, so repairs, vacancy, management and utilities sit outside the calculation. Budget for them separately.
The tradeoff is structural. A DSCR cash-out places a new first lien on the rental, while a HELOC places a second lien on your home.
| Route | Reviewed on | Collateral |
|---|---|---|
| Bank statement HELOC | Your deposits and DTI | Your home |
| DSCR cash-out | Rent versus payment | The rental |
| Full-documentation HELOC | Tax-return income | Your home |
What to Prepare Before You Apply
Preparation shapes the income number more than most borrowers expect.
- Statements: gather consecutive months from the account where commissions actually land.
- Forms: collect your 1099s and match them against the deposit trail.
- Narrative: write a short note explaining split commissions, referral fees and any unusual deposits.
- Property file: have the first-mortgage balance, a current homeowner’s insurance declaration and a clear title picture ready.
- Credit: a report is good for no more than 90 days at closing, so avoid new credit inquiries in the meantime.
- Account hygiene: keep transfers between your own accounts labeled, since underwriters strip them out.
Common Misconceptions
A bank statement line means no income review. Deposits are the review. The lender simply measures a different thing.
Every deposit counts. Only eligible deposits count, and a business account gets an expense factor.
My 1099 total is my qualifying income. The 1099 is gross, and the lender works from cleaned, averaged figures.
Any bank will do it. The product is rare and lender-specific, and it is often limited to primary residences.
Cheap first mortgage means cheap line. A second lien carries floating pricing, so the combined cost of a first mortgage plus an equity line needs checking against alternatives.
Key Terms Defined
HELOC: a revolving line of credit secured by home equity, with a draw period followed by repayment.
CLTV: combined loan-to-value, which adds the first mortgage and the new line together and divides by the home’s value.
Non-QM: a mortgage outside standard qualifying rules, often built around alternative income documents.
Expense factor: a percentage lenders subtract from business-account deposits to estimate usable income.
DSCR: the ratio of a rental’s income to its full monthly housing obligation.
Seasoning: the waiting period lenders want between events, such as after a bankruptcy or before a cash-out.
Next Steps
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. Many commission earners also weigh the rental route, so the brokerage looks at both products side by side. Lendmire’s piece Banks That Offer a Bank Statement HELOC for 1099 Contractors Who Own Rentals covers that crossover directly. You can reach the team at 828-256-2183.
This article is general education, not legal or tax advice. Consult a qualified professional, such as an attorney or CPA, about your own situation.
Frequently Asked Questions
Do big banks offer a bank statement HELOC to 1099 earners?
Rarely. Many large retail lenders write lines only on full tax-return documentation. Deposit-based lines sit mostly with specialty and wholesale lenders, which is why a broker that shops several of them matters.
How many months of statements will a lender want?
It varies by lender and by whether the account is personal or business. Your lender sets the window for your file.
Can I get a bank statement HELOC on a rental property?
Sometimes, within tight limits. On the wholesale network, an investment-property line runs up to 70% CLTV with a 700 minimum credit profile and a $500,000 maximum line, and it must be titled to you personally or a revocable living trust. Availability is limited to certain states, subject to lender guidelines.
What if my rental is in an LLC?
An LLC cannot hold title on these lines. You would need a vesting change, or a DSCR cash-out refinance that is reviewed on the rental’s income, subject to program terms.
Is a bank statement HELOC or a DSCR cash-out better for a commission earner?
It depends on which file is stronger. If your deposits and credit carry the application, a line on your home may fit. If the rental’s rent comfortably covers its payment, qualifying on the property may fit better.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker. Home equity lines of credit — on a primary residence, a second home or an investment property — are arranged through wholesale lenders in Lendmire’s 16 full-service states, and every line is underwritten by the lender under its program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
1. CFPB
3. CFPB – What you should know about HELOCs (booklet)
This article is part of Lendmire’s bank statement HELOC program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How Much Can You Borrow on a Bank Statement HELOC After a Bank Denial? · Banks That Offer a Bank Statement HELOC to Buy a Rental Without Selling Investments · How Much Can You Borrow on a Bank Statement HELOC for Owners Wondering Which Banks Say Yes?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Required disclosures. Lendmire (NMLS# 2371349) operates as a licensed mortgage broker, not a direct lender or depository. The discussion in this article is general in nature and should not be relied upon as financial, legal, or tax advice — every investment scenario is unique and should be reviewed by a qualified professional. Any loan inquiry is subject to lender underwriting, and this article is not a commitment to lend or a guarantee of approval. Mortgage rates, loan terms, and program guidelines vary by borrower, property, and state, and may change without notice. Equal Housing Opportunity. Verify licensure at NMLS Consumer Access.