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 score can work for a bank statement cash-out refinance, but it usually means tighter leverage or firmer pricing than a top-tier score would earn, and the effect varies by lender. The loan is reviewed on documented income under the applicable program, subject to lender guidelines, with 12 months of deposits standing in for tax returns.
- Income comes from averaging 12 months of business or personal deposits, less an expense factor the lender sets.
- Owner-occupied cash-out tops out around 80% LTV on a primary residence and 75% on a second home. Investment-property cash-out tops out around 75%.
- Loan sizes typically run from $125,000 to $3,500,000, with reserves commonly near six months of the housing payment.
- At 660, equity, reserves and clean deposits do the persuading that a higher score would otherwise do.
A 660 score sits in the middle of the credit range. It is not a dead end for alt-doc lending. It does change how a file gets priced and how much leverage a lender will extend.
What Is a Bank Statement Cash-Out Refinance?
A bank statement cash-out refinance replaces your current mortgage with a larger one and pays you the difference. The lender measures your income from bank deposits instead of tax returns or W-2s. It is a non-QM product, built for borrowers whose tax returns understate what they actually earn.
Self-employed owners, 1099 contractors and business owners often write off enough expenses that taxable income looks thin. Their deposits tell a different story. Scotsman Guide reports that self-employment growth is swelling demand for non-QM lending, and that some non-QM lenders will underwrite to debt-to-income ratios as high as 50%.
The cash-out mechanics match any other cash-out refinance. The new loan is larger than the balance owed. Closing costs and fees apply, and they reduce what lands in your account.
How Does a 660 Score Change the Picture?
At 660, expect a lower leverage cap, firmer pricing or both compared with the top credit tiers. The size of that effect depends on the lender, because each wholesale lender in a broker’s network sets its own overlays.
Across the programs that Lendmire, a mortgage broker, places files with, credit tier and leverage move together. A stronger score tends to earn the top of a program’s range. A mid-600s score often lands a few points lower on the leverage ceiling, or requires more reserves to offset it. Some programs treat 660 as a tier boundary. Others price it as a standard tier with no special penalty.
The practical point is that 660 is workable but not neutral. What matters most is what else is in the file:
- Equity cushion. Borrowing well under the cap helps.
- Reserves. More liquid cash than the minimum signals strength.
- Deposit history. Steady, explainable deposits carry weight.
- Payment history. A clean record over the past 12 months matters more than the headline score.
What Are the Leverage Limits for a Cash-Out?
Cash-out ceilings are lower than purchase ceilings, and they depend on occupancy. The figures below describe typical guidelines from select lenders in Lendmire’s wholesale network, subject to lender guidelines, credit and loan size.
| Property and occupancy | Typical cash-out ceiling |
|---|---|
| Primary residence, fixed expense ratio | Up to 80% LTV |
| Primary residence, accountant-prepared ratio | Up to 75% LTV |
| Second home | Up to 75% LTV, by loan size and credit |
| Investment property | Up to around 75% LTV |
Notice the accountant-prepared route carries the lower ceiling, not the higher one. Borrowers sometimes assume a CPA letter buys more leverage. It usually buys a different expense factor, which may help income but caps leverage lower.
You may also hear about 90% LTV on a primary residence. That figure applies to purchase and rate-term transactions through select lenders, not cash-out. Keep the two straight when comparing quotes. Final terms depend on lender guidelines, property type, leverage, and the borrower’s complete credit picture.
An asset-depletion route is another option. It qualifies a borrower from liquid assets rather than deposits, and it runs to about 80% LTV on a primary residence. It can suit a retiree or someone whose deposits are lumpy. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
Two limits govern every cash-out, and the tighter one wins. Equity caps how much can come out. Income caps how large a payment you can carry. A borrower with abundant equity but modest averaged income is limited by income. A borrower with strong income but a recent purchase is limited by equity.
How Do Bank Statements Become Qualifying Income?
Underwriters average eligible deposits over 12 months, remove what is not income, then apply an expense factor on business accounts. The result is a monthly income figure tested against the new housing payment and your other debts.
Here is the sequence most programs follow.
1. Choose the account type. Business statements get an expense factor. Personal statements generally carry little or none.
2. Scrub the deposits. Transfers between your own accounts, loan proceeds and refunds come out.
3. Handle large one-offs. A big unexplained deposit is either excluded or needs a letter of explanation.
4. Apply the expense factor. The lender sets this percentage, and it varies by program. Some allow an accountant-prepared ratio instead of a fixed one.
5. Average over the window. Eligible deposits, less the factor, divided by 12.
6. Test against obligations. The monthly figure is measured against the new payment and other debts.
Consider a modeled borrower who runs a landscaping business. The business account shows steady deposits across 12 months, plus one large transfer from a personal savings account in month seven. The transfer comes out because it is not business income. The remaining deposits take the lender’s expense factor. The qualifying figure ends up well above what the borrower’s tax return shows, yet below the raw deposit total. That gap is normal. Anyone who expects raw deposits to equal income will be disappointed.
Underwriting here is still real underwriting. Under the federal ability-to-repay framework, the CFPB’s compliance guide says a creditor must consider at least eight underwriting factors, and the rule does not mandate a single method. The NCUA’s supervisory letter adds that the information a lender relies on must be verified with reliable third-party records. Bank statements are those records.
What Does the Application Process Look Like?
The process runs in a clear order, and a broker shopping multiple wholesale lenders matches the file to the program that fits it. No timeline is promised here, because each file is underwritten individually.
1. Decide the goal. Know how much cash you need and what it is for. Size it against both equity and income.
2. Pull your credit. Check the score and look for errors or high revolving balances that a paydown could fix.
3. Gather 12 months of statements. Use business or personal accounts, whichever best reflects your income. Keep every page.
4. Prepare explanations. Write short notes for large or unusual deposits before the underwriter asks.
5. Share the scenario with a broker. The broker compares programs on property type, occupancy, credit, leverage and documentation.
6. Submit the full package. Expect statements, ID, your current mortgage statement, insurance and proof of reserves.
7. Appraisal and underwriting. The appraisal sets value, which sets the cash-out cap.
8. Clear conditions and close. The lender may ask for more documents. Respond completely and the file stays on track.
Lendmire’s complete DSCR loans guide covers the investor-side alternative if your property is a rental and you would rather qualify on its income than your own.
Which Documents Do You Need?
Plan for these items. Missing pages are the most common source of delay.
| Document | Why it is requested | Common snag |
|---|---|---|
| 12 months of statements | Establishes deposit income | Missing pages |
| Mortgage statement | Confirms payoff and history | Outdated copy |
| Proof of reserves | Shows liquid cushion | Funds moved recently |
| Insurance declarations | Confirms coverage | Lapsed or low limits |
| Letter of explanation | Clears large deposits | Vague wording |
Cash-out proceeds generally do not count toward reserves unless a program says otherwise. Ask early, because treatment differs.
What Is the Catch for Investment Properties?
Occupancy decides the rules, and it can change which loan fits. An owner-occupied file is a consumer mortgage, so 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 category your property falls into before you apply.
Investment cash-out on bank statements tops out around 75% LTV. Investment purchase leverage on this documentation varies by lender, and investor-focused leverage guidance really belongs on the DSCR side.
Here is the tradeoff. A bank statement loan scrutinizes your deposits. A DSCR loan scrutinizes the property’s rent and sets your personal income aside. If your deposits are declining or volatile, a bank statement file gets harder. A rental with solid rent may do better as a DSCR file. If your rental is thin but your business is strong, the bank statement route may carry it. The better program depends on the property, the borrower and how each documents.
Some borrowers are surprised to learn this. For a rental, the DSCR path often fits more naturally. For a primary residence or second home, bank statement documentation is the usual tool.
Where Does the General Rule Break?
A few edge cases change the answer.
- Recent purchase. Seasoning, the time since you bought or last cashed out, is set by each program. A cash buyer or recent purchaser may face different rules than a long-time owner.
- Large deposits. A single big deposit can be excluded or questioned.
- Declining deposits. If the recent months run below earlier ones, lenders may average conservatively or look at the trend. That can shrink the qualifying figure.
- Commingled accounts. Mixing personal and business funds muddies the review. Separate accounts are cleaner.
- Joint applications. Lenders generally pick one qualifying score from the borrowers, so confirm which one applies before you apply.
What If You Get Declined or Offered Less?
A reduced offer is a prompt to adjust, not a final answer. Common levers include:
| Problem | Possible fix | What to expect |
|---|---|---|
| Income too low | Switch account type or use an accountant-prepared ratio | May change qualifying income |
| Leverage too high | Request a smaller cash-out amount | Moves under the cap |
| Score at a tier edge | Pay down revolving balances | May lift the tier |
| Thin reserves | Add liquid assets | Offsets a mid-tier score |
| Messy deposits | Clean up and explain | Raises eligible income |
Ask what the next credit tier would change. Moving from 660 toward 680 or 700 may improve leverage or pricing, though the benefit depends on the program. That is worth a conversation before you apply, not a number to assume.
How Much Cash-Out Is Too Much?
Pulling out as much as the cap allows is not always wise. A larger loan raises your obligation, and on a rental it can erase cash flow. Keep a margin below the ceiling, and decide in advance how the money will be used. Cash-out that funds an income-producing purpose is a different decision from cash-out that covers spending.
Closing costs and fees come out of proceeds. A modest cash-out can shrink quickly once costs are counted, so run the net figure before committing.
Key Terms Defined
Non-QM loan: A mortgage that does not follow standard qualified-mortgage documentation rules and uses alternative ways to verify repayment ability.
Expense factor: The percentage a lender subtracts from business deposits to estimate income after operating costs.
Seasoning: The time that has passed since you bought the property or last refinanced it.
LTV: The loan amount divided by the property’s appraised value.
Reserves: Liquid funds you hold after closing, usually counted in months of housing payments.
Asset depletion: A way to qualify using liquid assets in place of monthly income.
Frequently Asked Questions
Can I qualify for a bank statement cash-out refinance with a 660 credit score?
Often yes, though treatment varies by lender. A 660 score usually means a lower leverage cap, firmer pricing or higher reserve expectations than top-tier credit. Strong equity, reserves and clean deposits improve the file. Eligibility remains subject to lender guidelines and individual review.
How much can I borrow against my home?
On a primary residence, cash-out typically reaches up to 80% LTV with a fixed expense ratio, or 75% with an accountant-prepared ratio. A second home typically reaches 75%, and an investment property around 75%. Loan amounts generally run from $125,000 to $3,500,000, depending on the program.
Do I need tax returns?
Not under a bank statement program. It is reviewed on documented income under the applicable program, subject to lender guidelines, using 12 months of business or personal statements. The lender still verifies what it relies on, so expect to supply complete statements and supporting explanations.
Will every deposit count as income?
No. Transfers between your accounts, loan proceeds and refunds are removed, and business deposits take an expense factor. Large one-off deposits may be excluded or need an explanation letter.
Is a bank statement loan better than DSCR for a rental?
It depends on the property and the borrower. A bank statement file looks at your deposits, while a DSCR file looks at the property’s rent. Owner-occupied homes usually fit bank statement documentation, while rentals often fit DSCR more naturally.
Next Step
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. Lendmire is a mortgage broker arranging financing through select lenders in its wholesale network, and consumer mortgage availability covers 16 states. Programs are not a commitment to lend. A mid-600s score is rarely the whole story, and the borrowers who fare best are the ones who prepare their statements before the first conversation.
Investors weighing their equity options can start with Lendmire’s guide to cash-out refinance on an investment property.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage brokerage serving self-employed and high-net-worth borrowers in 16 states. Bank statement, P&L-only, 1099-only and asset-based mortgages are arranged through wholesale lending channels; Lendmire brokers the financing and the lender underwrites each application. 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. Scotsman Guide: Rev Up the Engine for Non-QM Lending
2. CFPB ATR/QM Small Entity Compliance Guide
3. NCUA Supervisory Letter 14-01
This article is part of Lendmire’s bank statement loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Can You Get Approved for a Bank Statement Cash-Out Refinance When the Appraisal Is Low? · 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
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.