Profit & Loss (P&L) Loans — Star Financial 

Qualify using a CPA-prepared Profit & Loss statement (and supporting business bank activity) instead of tax returns. Built for self-employed owners whose write-offs reduce taxable income but not true cash flow.

Who This Helps

• Sole proprietors, LLC/Corp owners, partners
• Service businesses with clean bookkeeping but aggressive deductions
• Borrowers needing a faster, simpler alternative to full tax returns

Key Benefits

• No tax returns in many programs — qualify with 12–24 months P&L
• Common-sense underwriting based on actual business performance
• Purchases, rate/term, and cash-out available
• Primary residence, second home, and many investment properties (program-specific)

How Income Is Calculated (Typical)

• CPA/EA-prepared P&L covering 12 or 24 months provides gross revenue and expenses
• Net income from the P&L (plus add-backs per program) → monthly qualifying income
• Business bank statements used to validate revenue and P&L reasonableness
• Some investors accept YTD P&L + prior year or require a business expense factor check

Exact methods vary by investor matrix. We’ll run side-by-side scenarios and confirm the best fit.

Basic Eligibility (Varies by Program)

• In business ≥ 2 years (some allow 1 year with compensating factors)
• FICO / LTV / reserves per program matrix
• Clean housing history and verifiable business ownership

Documents You May Need

• CPA/EA letter and P&L (12–24 months), signed & dated
• Business bank statements (e.g., last 12 months) to support revenue
• Business license/formation docs, KBA/ID, HOI, HOA docs (as applicable)
• Purchase contract & EMD (purchase) or payoff info (refi)

What to Consider

• Non-QM pricing/fees may differ from agency loans
• Consistency between P&L and bank deposits is critical
• Reserves/overlays are often higher than traditional QM
• Programs may exclude one-time or non-recurring income

How It Works

1. Consult & pre-screen (ownership %, revenue patterns, goals)
2. Pre-qual using P&L method & program rules
3. Underwrite (upload P&L, bank statements, appraisal, title)
4. Close — purchase or refinance with terms aligned to your plan

Star Financial • NMLS 1429 • Serving CA, TX & FL
Disclosures: Non-QM program; not a commitment to lend. Eligibility, rates, and terms subject to change and full underwriting approval. All loans subject to credit, income/asset, and property verification per investor guidelines. Consult your tax advisor.