Bank Statement loan rates vary based on the changing market, your credit score, the length of your loan term, and other factors. They are generally higher than the rates for Conventional loans by typically 0.5-2%. Other factors that affect Bank Statement loan rates include:
- Down payment: A higher down payment mitigates risk to the lender and may result in lower interest rates.
- Credit score: The same way a higher down payment may result in a lower interest rate, a higher credit score also indicates more security for the lender and may qualify you for a lower interest rate.
- Property type: Different properties in different markets are more or less likely to appreciate and may be in more or less demand. These differences can affect your interest rate.
- Savings: Larger cash reserves indicate financial security to a lender and may result in a lower interest rate.
Bank statement loans offer flexible income requirements. This makes them a potentially valuable tool for self-employed individuals, gig workers, and investors. If you think a Bank Statement loan may be right for your needs, reach out to a New American Funding loan officer today.