The Quick Read: The best program for a commissioned agent is the one that reads your deposits the way you actually earn them: lumpy, closing-driven, and mostly 1099. Across Lendmire’s wholesale network, bank statement programs review your file on documented income under the applicable program, subject to lender guidelines, instead of on a tax return swollen with write-offs. The right fit depends on your property, your deposit pattern, and how much equity you want out.
- On a primary residence, cash-out typically tops out around 80% LTV. That is with a fixed expense ratio, or 75% with an accountant-prepared ratio.
- On a second home, cash-out typically runs up to 75% LTV.
- On an investment property, cash-out tops out around 75% LTV.
- Most programs want 12 months of statements, and reserves commonly run around 6 months.
- If the property is a rental, a DSCR cash-out may beat a bank statement loan because it ignores your personal deposits.
Commission income confuses standard underwriting. Your 1099 shows gross pay, so it overstates what you kept. Your tax return, after Schedule C deductions, understates your cash flow. Neither number tells the truth, and a bank statement program exists to fix that gap.
This guide walks through how these files are read, step by step. It then covers the program structures, the edge cases that trip agents up, and how to decide.
Who Decides What “Best” Means for an Agent?
There is no single best program. The best fit is the one matched to your deposit pattern, your property type, and the leverage you need.
Lendmire is a mortgage broker, not a lender. It places files with select lenders in a wholesale network, and those lenders each set their own guidelines. That vantage point is useful. Most programs we place files with look similar on the surface, then differ sharply on the details that matter to an agent: how they scrub deposits, which expense factor they apply, and how they treat a weak recent stretch.
So instead of naming a winner, use these criteria.
| Criterion | Why it matters for commission income |
|---|---|
| Statement type accepted | Personal vs. business changes the expense treatment |
| Expense factor method | Biggest swing in your qualifying income |
| Deposit scrubbing rules | Splits, transfers, and referral fees get handled differently |
| Occupancy fit | Primary, second home, and rental have different ceilings |
| Handling of declining income | Matters if your last stretch was slow |
| Reserves and credit overlays | Can decide a borderline file |
A broker that shops several lenders can match your file to the program whose overlays fit your pattern. A single lender can only offer its own.
How Does Underwriting Treat Commission Income Step by Step?
The lender converts a stream of deposits into one monthly income number, then compares it to your debts. Every step is a place where an agent’s file can gain or lose income.
Here is the sequence on most programs.
1. Pick the account type. Personal statements, business statements, or both, depending on how you get paid.
2. Pull the window. Most programs we place start at 12 months of statements. All pages, every month.
3. Scrub the deposits. Transfers between your own accounts, loan proceeds, refunds, and one-time items come out.
4. Average what is left across the window.
5. Apply an expense factor on business statements. Personal statements generally skip it.
6. Divide by the months to reach monthly qualifying income.
7. Compare to debts. The test is debt-to-income: your monthly debts, including the new payment, divided by qualifying income.
8. Underwrite the collateral. An appraisal sets value, and the lender checks leverage, credit, and reserves.
The lender sets the expense factor, not you. Some programs let an accountant-prepared expense ratio support a different figure. That is why the owner-occupied cash-out parameters have two tiers: a fixed ratio at the higher ceiling on a primary residence, and an accountant-prepared ratio at 75%.
Nothing here is “no-doc.” Every file is fully documented and individually underwritten. Federal rules still require a lender to make a reasonable, good-faith determination that you can repay, based on reliable records, as the CFPB’s compliance guide explains. Bank statements are one way lenders meet that duty with variable income.
What Deposits Count, and What Gets Thrown Out?
Earned commission counts. Money that is not earned income does not. The scrub is where agent files most often change.
What usually stays in:
- Commission checks and brokerage payouts deposited into the account used.
- Consistent, documented income tied to your license and business.
What commonly comes out or gets questioned:
- Transfers between your own accounts.
- Loan proceeds and refunds.
- Proceeds from selling your own investment property. Those are asset sales, not earnings.
- Referral fees that cannot be tied to your business.
- Business and personal money mixed together. Commingling is not automatically disqualifying, but expect more explanation.
Splits matter too. If your brokerage routes commission through a team or you pay out splits to others, business statements with an expense factor often fit better than personal statements. If commissions land straight in your personal account from one brokerage, personal statements with no expense factor may work.
Keep closing disbursement records or brokerage commission statements handy. They explain large deposits before the underwriter asks.
Worked Example: From Deposits to a Loan Ceiling
The math runs deposits, minus ineligible items, averaged, then adjusted by the expense factor. Here is a conceptual walk-through with no dollar amounts, because every lender’s factor differs.
Say an agent’s 12 months of business statements show strong closings in spring and summer and almost nothing in winter. The lender removes one transfer from savings and one deposit from a personal property sale. It averages the remaining deposits over 12 months. Then it applies the program’s expense factor, which cuts the number by a set share. What is left is monthly qualifying income.
Now compare two agents with the same gross deposits. One deposits into a personal account with no splits, so no expense factor applies. The other runs a team and uses business statements, so a factor applies. The first agent can show materially higher qualifying income from the same cash. That is the single biggest swing in these files.
From there, the property sets the ceiling. On an owner-occupied primary residence, cash-out runs up to 80% LTV. The percentage ceiling is the same however the income lands; the income decides whether the debt-to-income test clears, not the LTV. Loan sizes in the network run from roughly $125,000 to $3,500,000, and reserves commonly sit around 6 months of the housing payment.
Personal vs. Business Statements
Personal statements fit agents paid straight to themselves. Business statements fit agents with splits, teams, or an entity.
| Agent setup | Usually fits | Expense factor |
|---|---|---|
| 1099 agent, paid to personal account | Personal statements | Generally none |
| Agent with team or splits | Business statements | Program factor applies |
| Agent paid into own LLC or S-corp | Business statements | Program factor applies |
| W-2 commissioned agent | Often conventional | Not applicable |
A W-2 commissioned agent may not need this at all. Standard agency underwriting averages commission over about two years and uses the lower figure if income is declining, as the Fannie Mae Selling Guide on commission income lays out. If your W-2 history is clean and rising, conventional may be simpler. Bank statement programs earn their place when write-offs or entity structure make the tax return understate you.
Which Property Type Is the Cash-Out On?
Occupancy sets the leverage ceiling and decides which rules apply. Pick the wrong frame and you misread what is available.
| Property | Cash-out ceiling | Disclosure regime |
|---|---|---|
| Primary residence | Up to 80% LTV (75% with accountant-prepared ratio) | Consumer mortgage |
| Second home | Up to 75% LTV | Consumer mortgage |
| Investment property | Around 75% LTV | Business-purpose |
The 90% figure you may see applies to primary residence purchase and rate-term transactions, not cash-out. In a cash-out, never plan around it.
Occupancy also decides the paperwork. An owner-occupied file is a consumer mortgage, so consumer disclosure rules apply. A bank statement loan on a non-owner-occupied rental, including a short-term rental, is business-purpose and exempt from those consumer disclosure rules. 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.
Consumer mortgage lending through Lendmire covers 16 states, so confirm your state before building a plan around an owner-occupied cash-out.
Where the General Rule Breaks
- Declining income. Traditional underwriting uses the lower recent figure. Programs differ on whether a 12-month window helps if the earlier year was stronger or weaker. Ask before you pick a window.
- One big quarter. A single large closing season can lift a 12-month average. It can also draw questions if deposits look like asset sales or loans.
- A closing just outside the window. A commission that lands one month before your statement period starts does not count. If a big check is coming, timing the application matters.
- Short self-employment history. Many programs want around two years in business, with possible exceptions for prior same-industry experience. Exceptions are program-specific.
- Recent purchases. Cash-out generally requires some ownership seasoning.
- Commingled accounts. Fixable with documentation, but not free of friction.
When a DSCR Cash-Out Beats a Bank Statement Loan
If the property is a rental, DSCR often wins, because it qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Your personal deposits are not the test.
A DSCR loan divides the property’s monthly rent by its monthly obligation. That ratio is the coverage number. Many standard programs are built around a 1.00 benchmark, and select lenders in the network will review sub-1.00 coverage, though leverage and terms adjust. Credit, appraisal, and reserves still apply.
The tradeoff is simple. Bank statement works when your income is strong but the rent does not cover the new payment on a cash-out. DSCR works when the rent covers it and you would rather not have your deposits scrutinized. Many agent-investors price both. Lendmire’s complete DSCR loans guide covers how coverage is calculated.
Other options exist: a second lien or HELOC that leaves your first mortgage alone, or conventional cash-out if your income reads cleanly.
Key Terms Defined
- Bank statement loan: A mortgage that is reviewed around documented income taken from your bank deposits instead of tax returns.
- Expense factor: The share of business deposits a lender treats as operating costs before counting income.
- Cash-out refinance: A new, larger mortgage that pays off your old one and hands you the extra equity.
- LTV (loan-to-value): The loan amount divided by the property’s appraised value.
- DTI (debt-to-income): Your monthly debts, including the new payment, divided by qualifying monthly income.
- DSCR: Debt service coverage ratio, meaning a rental’s monthly rent divided by its monthly debt obligation.
- Seasoning: The waiting period a lender wants after you buy before you can cash out.
What a Strong Agent File Looks Like
Clean deposits, a clear story, and enough equity left in the property. Prepare these 3 to 6 months before you apply if you can.
- Every page of every statement for the full window.
- Proof of license and business existence.
- Brokerage commission statements or closing disbursements for large deposits.
- A CPA letter or P&L if the program allows one.
- Lease and mortgage statement for a rental.
- Insurance and entity documents if the property sits in an LLC, subject to lender program eligibility.
Then do the quiet housekeeping. Stop moving money between accounts. Route commissions to one account. Pay down card balances if credit is the weak spot. Keep personal and business deposits apart.
Remember that cash-out interest begins on the full new balance right away, and refinancing means a new loan with closing costs. Check the property’s cash flow after the refinance before you commit.
Lendmire can help you compare bank statement loan options based on your deposits, the property, credit profile, leverage, and your goals. Qualification is subject to lender guidelines, and nothing here is a commitment to lend.
This article is general education, not legal or tax advice. Tax treatment can depend on how the funds are used and how the property is held; borrowers should keep clear records and speak with a qualified tax professional or attorney before relying on any deduction.
Frequently Asked Questions
Can an agent do a cash-out refinance without traditional personal-income documentation?
Yes, through a bank statement program, which is reviewed around documented income under the applicable program, subject to lender guidelines. You still provide full statements, proof of your business, and collateral documents. Nothing is undocumented.
Do I need a business bank account?
Not always. Agents paid straight to a personal account can often use personal statements, which generally skip the expense factor. Agents with splits, a team, or an entity usually fit business statements better.
What happens to referral fees and transfers?
Transfers between your own accounts come out of the income calculation. Referral fees may count if you can tie them to your licensed business, but lenders differ. Keep the paper trail.
How much equity can I take out?
It depends on occupancy. On a primary residence, cash-out typically reaches up to 80% LTV (75% with an accountant-prepared ratio). On a second home it typically reaches 75%, and on an investment property it tops out around 75%. Credit and loan size move the number.
What if my last few months were slow?
A weak recent stretch can pull down a 12-month average. Programs treat it differently, so a broker can steer you toward lenders whose approach fits your pattern, or suggest waiting for a stronger window.
A deeper walk-through of investment-property equity extraction lives in Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire is a mortgage brokerage (NMLS# 2371349) licensed for consumer mortgage lending in 16 states, arranging bank statement and other alternative-documentation mortgages — P&L-only, 1099-only and asset-based paths — through a wholesale lending network. Eligibility is determined by the lender on each file. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
Get Started
Ready to find the right loan for you?
See your offer in seconds. No credit pull, no obligation.
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 ATR/QM Small Entity Compliance Guide
2. Fannie Mae Selling Guide B3-3.1-04: Commission Income
This article is part of Lendmire’s bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Bank Statement Cash-Out Refinance Rules After a Divorce Buyout · Bank Statement Cash-Out Refinance Rules on an Inherited House · Bank Statement Cash-Out Refinance Requirements for a Buyout
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Disclosures. The information presented in this article is general market commentary, not financial, legal, or tax advice. Lendmire is a mortgage brokerage (NMLS# 2371349) — not a direct lender or depository institution — and loan placement is subject to lender underwriting. Nothing in this content represents a commitment to lend. Loan terms, pricing, and program availability vary based on borrower qualifications, property characteristics, and state of subject property, and are subject to change at any time. Lendmire complies with Equal Housing Opportunity requirements. Consumer access: nmlsconsumeraccess.org.