Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
The Quick Read: A 660 credit score does not block a bank statement cash-out refinance, but it moves your file into a lower leverage tier, so underwriters lean harder on your deposit history, your equity and your reserves to decide how much cash you can take out. The income method stays the same at any score. What changes is how much of your equity the lender will release and how much cushion it wants behind the loan. Every figure here varies by lender and program — guidelines, property type, leverage, and credit profile all apply.
- Income is built from about 12 months of bank statements, with deposits cleaned and averaged.
- Your score sets the leverage tier, not whether the program is open to you.
- Cash-out ceilings depend on occupancy: primary residence, second home or investment property.
- Reserves of roughly 6 months of the housing payment are common.
- Cleaner statements, lower leverage and stronger reserves can offset a weaker score.
What a Bank Statement Cash-Out Refinance Is
A bank statement cash-out refinance replaces your current mortgage with a larger one and pays you the difference in cash. The lender reviews your file on your deposits instead of your tax returns.
This is a non-QM loan. Non-QM means the loan sits outside the standard qualified-mortgage documentation box, so the lender writes its own income rules. Self-employed owners are the usual borrowers. Their tax returns often show less income than their accounts actually receive, because write-offs shrink the number on paper.
Bank statement lending is a mainstream product. HousingWire’s non-QM guide reports that bank statement loans made up about 34% of non-QM volume in a recent year, with DSCR loans at 29%.
On our side of the table, across the wholesale network Lendmire works with, this loan is reviewed on documented income under the applicable program, subject to lender guidelines. Lendmire is a mortgage broker. It matches your file to a program and does not lend directly.
Key Terms Defined
Qualifying income: The monthly income figure the lender actually uses after cleaning and averaging your deposits.
Expense factor: The share of business deposits the lender treats as operating costs rather than income. It varies by program, business type and documentation.
Deposit scrubbing: The lender’s process of removing transfers, loan proceeds, refunds and one-time deposits from your statements.
LTV (loan-to-value): The new loan balance divided by the appraised value of the property.
Reserves: Liquid cash you must still hold after closing, usually counted in months of the housing payment.
Overlay: A lender’s own rule that is stricter than the baseline program, such as a lower leverage cap for a lower score.
How Underwriting Works, Step by Step
Underwriting runs in a fixed order. Your score matters at the credit step and again at the leverage step. It barely touches the income steps.
Step 1: Choose the statement period and account type. Most programs in our network use 12 months of statements. You can submit business or personal accounts, and a few programs accept either. Some programs do not allow mixed personal and business accounts in one income calculation. The deposits also need to fit the kind of work you do.
Step 2: Scrub the deposits. Transfers between your own accounts do not count. Neither do loan proceeds, refunds or one-off deposits. Only recurring income stays. Underwriters flag large or unusual deposits and ask for a written explanation or a paper trail.
Step 3: Apply the expense factor. On business accounts, the lender subtracts an expense factor from the cleaned deposits. A fixed factor is the simplest route. A factor prepared by your accountant can be an option on some programs, and it can raise or lower your qualifying income depending on your actual costs. Personal-account deposits are generally counted with a lighter or no expense factor, but they must trace back to the business. No universal formula exists, and your file gets its own treatment.
Step 4: Average the deposits into one monthly figure. The lender adds up the usable deposits and divides by the number of months. That figure goes into your debt-to-income test along with the new payment and your other debts.
Step 5: Pull credit and set the tier. The score, the purpose of the loan and the occupancy decide your leverage tier. This is where a 660 shows up.
Step 6: Order the appraisal and test the equity. The appraised value and the cash-out ceiling decide the maximum new loan.
Step 7: Check reserves and final conditions. The lender confirms you hold the required reserves and clears any open items from the deposit review.
Where a 660 Score Sits
A 660 is workable, but it sits at the low end of what this loan usually sees. The typical non-QM borrower is much stronger. Scotsman Guide’s data review puts the average non-QM borrower score at 776, with an average LTV of 75%. Those are borrower averages, not program limits.
Lenders price risk, and a bank statement cash-out stacks three risk factors together: lighter documentation, cash taken out of equity and a lower score. Scotsman Guide, reporting dv01 performance data, found impairment rates around 22% for borrowers below 660, versus slightly under 15% for scores from 660 to 700. The same report found loans under 60% LTV had impairment rates under 5%. Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
That is performance data, not a rule. It still explains why lenders hold back leverage at lower scores. A 660 file is read as acceptable credit that needs more equity behind it.
No federal rule sets the 660 floor or the leverage grid. Lenders write those standards themselves, and the CFPB’s ability-to-repay rule says creditors may develop their own underwriting standards as long as they consider the required factors. The score tiers you run into are each program’s own overlays.
How the Lender Picks Your Qualifying Score
You may have several scores, and the lender uses one. On most files with a single borrower, programs take the middle of the three bureau scores. With more than one borrower, many programs use the lower borrower’s qualifying score.
This matters if you sit near a tier line. A middle score a few points above or below the next tier can change your maximum leverage. Pulling your own reports before applying lets you spot errors, such as a stale collection or a wrong balance, that may be dragging the middle score down.
What a 660 Changes and What It Doesn’t
| Item | At a 660 score |
|---|---|
| Statement method and deposit scrubbing | Unchanged |
| Expense factor logic | Unchanged |
| Maximum cash-out LTV tier | Usually lower than at 700+ |
| Reserves expected | Often held at or above the program norm |
| Compensating factors weighed | More weight on equity and cash |
| Loan options in the program | Can narrow, depending on the lender |
The income side does not punish you for the score. If your deposits support the loan, they support it at any tier. Credit decides how much of your equity the lender will release.
Leverage by Occupancy: What the Ceilings Look Like
Occupancy decides the cash-out ceiling, and a purchase ceiling never applies to a cash-out. Across the select lenders in Lendmire’s network, the typical ranges look like this. Exact limits move with loan size and credit, and a 660 file generally lands below the top of each range.
| Property and transaction | Typical maximum LTV |
|---|---|
| Primary residence cash-out, fixed expense ratio | Up to 80% |
| Primary residence cash-out, accountant-prepared ratio | Up to 75% |
| Second home cash-out | Up to 75% |
| Investment property cash-out | Up to about 75% |
| Primary residence purchase or rate-and-term (not cash-out) | Up to 90% |
The accountant-prepared route is the lower ceiling, not the higher one. It trades some leverage for an income figure that reflects your real costs.
An asset-depletion alternative is reviewed against liquid assets instead of deposits, with leverage up to about 80% on a primary residence. Some borrowers with a 660 score and large liquid holdings find this route cleaner than a statement review. Loan sizes in this lane generally run from about $125,000 to $3,500,000.
For investment purchases on bank statement documentation, leverage varies by lender. Investor-focused leverage guidance sits on the DSCR side.
Primary Home or Rental: Which Rules Apply
Occupancy decides the disclosure regime, and the two never mix. An owner-occupied file, meaning a 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 a business-purpose loan and is exempt from TRID.
Purpose is a fact-based call. The federal definition of business-purpose credit excludes loans made primarily for business reasons, even when a dwelling secures them. Lenders look at how the loan is described and how the property is used. If the proceeds go to personal spending or you may live in the property, expect the file to be treated as a consumer loan.
For consumer-purpose files, Lendmire’s mortgage licensing covers 16 states, so availability depends on where the property sits.
When the General Rule Breaks
Several edge cases can move a 660 file in either direction.
- Statement length. Twelve months is typical. A longer history can change income and pricing, in your favor or against you.
- Seasonal income. A business with big summer deposits and thin winters averages out lower than its best months suggest.
- Deposit spikes. One large unexplained deposit gets removed or documented. It will not raise your income.
- Mixed accounts. Personal and business flows that blend together can confuse the calculation. Some programs reject the mix.
- LLC vesting. Entity borrowers can have different program rules, subject to lender program eligibility.
- Cash-out proceeds caps. Larger cash-out amounts at higher LTV tiers can trigger extra conditions.
Bank Statement or DSCR on a Rental
On a rental, you often have a second path. A DSCR loan (debt service coverage ratio) qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. It sets your personal deposits aside. Lendmire’s complete DSCR loans guide covers how that math works.
The choice comes down to which income is stronger. If your business deposits are strong but the rent is thin against the payment, bank statements may fit better. If the rent covers the payment well and your personal income is messy, DSCR is usually the cleaner route. A score near 660 can be financed either way, with leverage and terms set by each program. Select DSCR programs also exist below 1.00 coverage, with adjusted leverage and terms.
A Worked Scenario
Picture a self-employed contractor with a middle credit score of 662 and a rental house with about 50% existing LTV. The contractor wants cash out up to the investment cash-out ceiling of around 75% LTV. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
The lender reviews 12 months of business statements and removes transfers between accounts and a one-time equipment-loan deposit. It applies the program’s expense factor to the remaining deposits. It averages the result into one monthly figure and runs the debt-to-income test with the new payment.
The score then caps leverage below the top tier. Say the lender offers a lower ceiling than the contractor hoped for. The contractor can take less cash, bring up the score and reapply, or present the file with stronger reserves and a documented expense ratio. Which path is right depends on how much cash is needed and what the file can support. The numbers here are modeled assumptions, not a quote or a commitment to lend.
What Strengthens a Borderline File
Underwriters weigh compensating factors. These tend to matter most, roughly in this order:
1. Lower leverage than the program maximum.
2. Reserves above the roughly 6-month norm.
3. Clean mortgage payment history.
4. A long record of self-employment in the same business.
5. Clear, well-organized statements with deposits that match the business.
Note that cash-out proceeds generally do not stand in for reserves on every program. Some lenders count part of the proceeds and others do not, so ask before you rely on them.
Wait or Proceed?
If your score is a few points from the next tier, waiting can pay off. A small score gain can unlock a higher leverage tier or a better program fit. If you need the cash for a time-sensitive purchase, the lower-leverage structure may still make sense.
Weigh three things. First, how much cash you need against how much the lower tier releases. Second, whether paying down a card or fixing a report error can move the score. Third, whether lower pricing at a better tier is worth the delay. A lower tier can raise your cost, so compare the full terms rather than only the maximum cash-out. Terms depend on the lender’s guidelines, the property type, the leverage, and a full review of the credit profile.
Before You Apply: A Short Checklist
- Pull your three credit reports and fix any errors.
- Keep business and personal flows in separate accounts where you can.
- Write down the source of any large deposit.
- Gather 12 months of statements for the accounts you plan to use.
- Ask your accountant whether a prepared expense ratio would help or hurt your income.
- Decide how much cash you actually need.
Frequently Asked Questions
Can I get a bank statement cash-out refinance with a 660 credit score?
Usually yes, though leverage is lower than at higher scores. The score sets the tier, not whether the program applies. Eligibility still depends on lender guidelines, your deposits, the property and your reserves.
Does a 660 score change how my income is calculated?
No. The lender cleans and averages your deposits the same way at any score. The score affects leverage, pricing and the cushion the lender wants behind the loan.
How much can I take out on a bank statement cash-out?
On a primary residence, up to 80% LTV with a fixed expense ratio, or 75% with an accountant-prepared ratio. On a second home, up to 75% LTV. On an investment property, up to about 75% LTV. A 660 file usually lands below the top of those ranges.
Do I need reserves?
Typically yes, commonly around 6 months of the housing payment. Whether cash-out proceeds count toward reserves varies by program.
Is a rental property treated differently from my home?
Yes. A rental held for investment is generally a business-purpose loan, while an owner-occupied home is a consumer mortgage. The disclosure rules differ, and the program terms can too.
Next Steps
If you are self-employed and want to see how the numbers work, Lendmire can help you compare bank statement loan options based on your deposits, the property, credit profile, leverage and your goals. Reach the team at 828-256-2183 or request a quote. The right program for your situation depends on the file, and a 660 score is a starting point for that conversation rather than a stopping point.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
As a mortgage broker (NMLS# 2371349), Lendmire helps self-employed and high-net-worth borrowers in 16 states qualify on bank statements, a profit-and-loss statement, 1099s or liquid assets instead of tax returns, through wholesale lenders. Lendmire is never the lender; program terms are set by the lender and its 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. HousingWire: Non-QM loans guide
2. Scotsman Guide: A decade later, non-QM loans prove a stable, crucial option
3. Scotsman Guide: Warnings flash in the low-doc, low credit score, high-LTV corner of non-QM lending
4. CFPB Regulation Z § 1026.43
This article is part of Lendmire’s bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Does a Bank Statement Cash-Out Refinance Make Sense to Invest in the Stock Market? · How Lenders Underwrite a Bank Statement Cash-Out Refinance With a 50% Expense Ratio · Can You Get Approved for a Bank Statement Cash-Out Refinance When the Appraisal Is Low?
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Legal disclosures. Lendmire (NMLS# 2371349) is a state-licensed mortgage brokerage that arranges financing through wholesale lender relationships. Lendmire is not a direct lender, depository institution, or registered financial advisor. The discussion above is general informational content about real estate financing — it is not financial, legal, or tax advice, and readers should consult licensed professionals for guidance on their individual circumstances. Loan inquiries are subject to lender underwriting; this article does not represent a commitment to lend. Loan terms, rates, and qualification standards vary by borrower, property, and state, and are subject to change at any time. Equal Housing Opportunity. NMLS Consumer Access: nmlsconsumeraccess.org.