Self Employed Home Equity
Bank Statement HELOC in Georgia: Use Your Equity Without Tax Returns
If you own a business, your tax returns may show far less income than you actually earn, because write offs do their job. A bank statement HELOC qualifies you on 12 months of deposits instead, so a homeowner with real cash flow and real equity can open a line of credit without the returns that would sink a regular application.
Four things to know first. You must draw at least 80% of the line at closing, so it behaves more like a lump sum than a line you tap later. The rate is variable and moves with the Prime Rate. The payment rises when the 5 year interest only period ends, even if the rate does not change. And how much you can take depends on the appraised value of your home and the final line amount the underwriter approves, which can be lower than the equity you see.
The Short Answer
What Is a Bank Statement HELOC?
A bank statement HELOC is a home equity line of credit for self employed borrowers that verifies income from 12 months of business or personal bank statements instead of tax returns. The underwriter totals eligible deposits, subtracts an expense factor (50% by default, lower with a CPA letter), adjusts for your ownership share, and uses the result to set how much you can borrow against your home while your first mortgage stays in place.
A regular HELOC uses tax returns and W2s, which can understate a business owner's income. A bank statement cash out refinance uses the same kind of statements but replaces your whole first mortgage, rate included. A bank statement HELOC keeps that first mortgage and its rate untouched.
Is This You?
Who a Bank Statement HELOC Fits
Usually a fit
- LLC and S corp owners who pay themselves less than the business earns
- Sole proprietors and contractors with steady deposits
- Realtors, loan officers and other commission earners
- Tradespeople, consultants and service businesses with low expenses
Usually not a fit
- Under 2 years self employed, unless you did the same work as a W2 employee first
- Owning less than 25% of the business
- ITIN borrowers and foreign nationals
- A home listed for sale in the last 2 months
Think twice if
- You want small draws over time; most of the line comes out at closing, and later draws are at least $5,000
- Your income would barely cover a payment figured above your starting rate
- Your tax returns already show strong income; a full documentation file may be simpler
No impact to your credit score
The Numbers
Bank Statement HELOC Limits on the Program We Use
| Item | Limit |
|---|---|
| Income documentation | 12 months of statements |
| Default expense factor on business statements | 50% |
| Minimum ownership of the business | 25% |
| Line amount | $50,000 to $1,000,000 |
| Minimum drawn at closing | 80% of the line |
| Debt to income ratio | Up to 50%, 43% on lines over $500,000 |
| Draw period, then repayment | 5 years interest only, then 25 years |
| Cash reserves required | None |
| Typical time to close in Georgia | 30 to 45 days |
Credit score and total borrowing limit, lines up to $500,000
| Credit score | Primary home | Second home | Investment property |
|---|---|---|---|
| 720 and above | Up to 90% | Up to 85% | Up to 75% |
| 700 to 719 | Up to 90% | Up to 85% | Up to 70% |
| 680 to 699 | Up to 85% | Up to 75% | Not available |
| 660 to 679 | Up to 70% | Up to 60% | Not available |
Total borrowing limit means combined loan to value: your first mortgage plus the new line, divided by the home's value. Credit starts at 660 for primary and second homes and at 700 for investment property. Larger lines carry lower limits. On lines to $750,000, a primary home can reach 80% at 720 and above and 75% at 680 to 719, a second home 75% and an investment property 65%, both at 720 and above. Lines to $1,000,000 are for primary homes only, up to 65% at 720 and above. Figures reflect the program we use as of October 2026, are subject to underwriting approval, and can change.
Other program rules worth knowing
- Credit history. No mortgage payment 30 or more days late in the last 12 months, and 48 months since any bankruptcy, foreclosure, short sale or deed in lieu. Below a 700 score you also need three accounts reporting for 12 months, two for 24 months, or one mortgage or installment loan for 36 months, with activity in the last 12 months and nothing 60 or more days late in that time; a thinner file can work on a primary home up to 75%.
- Recent purchase or refinance. On a primary home bought or refinanced in the last 6 months, the limit drops 10 points to a maximum of 80%. Second homes and rentals need 6 months since the last purchase or refinance. The line is always its own closing and cannot close with a home purchase.
- Property. Condos are capped at 80% and non warrantable condos at 75%. Parcels over 2 acres are capped at 80%, with a 10 acre maximum. Rural homes qualify only as a primary single family or PUD (planned unit development) with no agricultural features, on lines up to $500,000, at 70% with credit of 720 and above or 60% at 700 to 719. Limits drop 5 points in a declining market. Condotels, commercial or agricultural property, leaseholds, land trusts, age restricted communities, hobby farms, modular and log homes, land contract purchases and row homes do not qualify, and neither does a home with solar panels that carry their own lien.
- Valuation. Lines up to $400,000 may use an automated valuation backed by a property condition report; if it falls short, an appraisal or another approved valuation is ordered. Lines above $400,000 and rural homes need a full interior appraisal.
- Who can borrow. U.S. citizens, permanent residents and non permanent residents with a valid Social Security number. Anyone on title who is not borrowing still signs at closing. An LLC can hold the property only when it is a rental.
The Income Math
How the Underwriter Figures Your Income
The underwriter does not read your tax return. It reads your deposits, in four steps:
- Total 12 months of eligible deposits. Transfers between your own accounts, loan proceeds, refunds and income from an unrelated job are removed first.
- Subtract the expense factor. The default is 50% of deposits. A short letter from your CPA or tax preparer that states the period it reviewed and your actual expenses can lower it.
- Apply your ownership share. You need at least 25% of the business, and your income follows your share.
- Divide by 12. That monthly figure is your qualifying income.
| Ownership share | Deposits a month | Qualifying income a month |
|---|---|---|
| 100% owner | $20,000 | $10,000 |
| 50% owner | $20,000 | $5,000 |
| 25% owner | $20,000 | $2,500 |
Illustration only, at the default 50% expense factor. Actual qualifying income is set by the underwriter after reviewing every statement.
How much line that equity supports
Take a Georgia primary home worth $600,000 with a $300,000 first mortgage, owned by a borrower with a 720 credit score. Total borrowing can reach 90% of value, $540,000. Subtract the first mortgage and the largest line is $240,000, with at least $192,000 drawn at closing. The underwriter then checks that the borrower's income covers all monthly debts, including a payment on the full line figured above the starting rate, within the 50% debt to income limit. If it does not, the line is approved smaller.
Illustration only, not a quote, an offer or an approval. The final line depends on the appraised value, the underwriter's income calculation and your other debts.
Real Situations
Four Owners Where Bank Statements Tend to Win
The cash heavy business
Marcus runs two car wash locations in Henry County. Customers pay at the bay, everything is deposited, and the account shows about $30,000 a month. His accountant's return shows a fraction of that after equipment depreciation.
Why bank statements: the deposits show the business that the return hides.
The owner with heavy write offs
Tasha owns a landscaping LLC. Trucks, mowers and fuel are real costs, but she runs her vehicles and home office through the business, and her return shows modest income.
Why bank statements: the standard 50% factor treats half of deposits as income, often more than her return shows, and a CPA letter can lower it if her expenses really run under half.
The owner on a fixed draw
Andre owns a dental lab and pays himself the same $12,000 transfer into his personal checking account every month. The business account is busy and full of supplier payments.
Why bank statements: the full fixed transfer can count, using 12 months of personal statements plus 2 months of business statements, with no expense factor on the transfer.
If the business earns well beyond his draw, his business statements could show more; a loan expert can run the income both ways.
The 50% partner
Keisha and her sister each own half of a marketing agency that deposits about $40,000 a month. At the 50% factor that is $20,000 a month of business income, and Keisha counts her half, $10,000.
Why bank statements: the business account shows steady client payments, and her share is easy to document with the operating agreement.
Fictional borrowers for illustration. Actual qualifying income is set by the underwriter.
On the HELOC we use, income is shown with bank statements or full documentation (tax returns and W2s).
Georgia Only
What Changes in Georgia
- Intangible recording tax on the full line. $1.50 per $500, about 0.3%, charged once at closing on the total line amount whether you draw it or not, capped at $25,000. Later draws within the same line owe nothing more.
- An attorney closing. Georgia requires a licensed attorney to handle the closing, and the security deed, the Georgia document that pledges the home as collateral, is then recorded with the county.
- 30 to 45 days. That is a typical timeline from application to closing on a Georgia second lien.
- Three business days to cancel. On a primary home, federal law gives you until midnight of the third business day after closing to cancel, and no money is released before then.
Our team works with business owners in Atlanta and across Georgia.
Get Ready
What to Gather Before You Apply
A ballpark conversation needs no documents. When you decide to move forward, the underwriter will ask for:
- 12 months of complete bank statements, every page, for each account used for income
- Proof you own at least 25% of the business, such as articles of organization or an operating agreement
- A CPA or tax preparer letter if you want an expense factor below 50%
- Your current mortgage statement and homeowners insurance declarations
- A photo ID; anyone on title who is not borrowing signs at closing too
Costs
What a Bank Statement HELOC Costs
The rate. Variable: the Wall Street Journal Prime Rate plus a margin, and it can change each month. The agreement sets a floor the rate cannot go below and a lifetime cap it cannot go above. Your margin depends on credit, combined loan to value and line size, and is set in writing before you commit.
What the program we use does not charge. No underwriting fee, no annual fee and no prepayment penalty.
What closing still costs. Title and settlement, the property valuation, recording, the Georgia closing attorney and the intangible recording tax. Every cost is disclosed in writing before you commit.
What drives the rate higher. A lower credit score, a higher combined loan to value, a larger line and investment property occupancy usually raise the margin. A bank statement line usually costs more than a full documentation line for the same borrower, because the underwriter is accepting less paperwork.
The Process
From First Call to Funding
- Ballpark. Share your rough deposits, your home's value and your first mortgage balance. A loan expert tells you whether the numbers can work and whether a different path fits better.
- Application and statements. You submit 12 months of statements and the application. The underwriter calculates income and orders the valuation.
- Approval and closing. Plan on 30 to 45 days from application to a Georgia attorney closing.
- Funding. On a primary home, money is released after the 3 business day cancellation window.
Honest Answers
When Another Loan Fits Better
- Your first mortgage rate is already high, or you want one fixed payment: bank statement cash out refinance, and the full trade off on HELOC vs cash out refinance.
- You want a line you can draw slowly, or your returns show your income: compare the options on our HELOC page.
- You want one fixed lump sum: home equity loan.
- You are buying a home, not borrowing against one you own: bank statement loan or self employed loans.
Questions, Answered
Bank Statement HELOC Questions
Qualifying on Bank Statements
Can I get a HELOC if I am self employed and my tax returns show low income?
Yes. A bank statement HELOC qualifies you on the money that actually moves through your accounts over the last 12 months instead of the taxable income on your returns. Write offs that shrink your adjusted gross income do not shrink your qualifying income, because the underwriter starts from deposits. You still need enough equity, a qualifying credit score and a debt to income ratio within the limit.
Do I need tax returns at all for a bank statement HELOC?
No tax returns are needed when you qualify on bank statements. The underwriter uses 12 months of statements instead. If your returns already show strong income, a full documentation file using one or two years of W2s or tax returns may be simpler.
How does the underwriter turn my bank deposits into income?
The underwriter totals 12 months of eligible business deposits, removes anything that is not business income such as transfers between your own accounts, loan proceeds and refunds, and applies an expense factor. The standard factor is 50%, meaning half of the deposits are treated as business expenses. The result is multiplied by your share of ownership and divided by 12 to get monthly qualifying income.
What is an expense factor, and can a CPA letter lower it?
The expense factor is the share of your deposits the underwriter assumes goes to running the business. The default is 50%. If your real expenses are lower, a letter from your CPA or tax preparer can show it. The letter should state the 12 months it reviewed and your actual expenses. Short and specific works best.
Can I use personal bank statements instead of business statements?
Sometimes. If your business pays you a fixed amount into your personal account every month, the full deposit can count as income, using 12 months of personal statements plus 2 months of business statements to show where the money comes from. If your personal account is really where the business runs, it is treated like a business account and the 50% expense factor applies unless a CPA letter shows lower expenses.
What if I only own part of the business?
Your income follows your ownership share, and you need to own at least 25% of the business. With $20,000 a month in deposits and the standard 50% expense factor, a 100% owner counts $10,000 a month, a 50% owner counts $5,000 and a 25% owner counts $2,500.
Deposits, Accounts and Timing
Does all the money in my account count?
No. Only business income counts. Deposits from an unrelated job, transfers between your own accounts, loan proceeds and other money the business did not earn are backed out before the math starts. If a W2 paycheck and your business income land in the same account, the paycheck deposits come out of the business calculation.
Can I use more than one business account?
Yes, when the setup makes sense. Owners with more than one business, or one business that keeps separate accounts for payroll or taxes, can often use them. Expect the underwriter to ask what each account is for and to trace transfers between them so the same money is not counted twice.
How long do I need to be self employed?
Generally 2 years. If you worked as a W2 employee in the same line of work before you went out on your own, a shorter history can work. Either way you need at least 12 months of statements, because that is the window the income is calculated from.
Can I use 24 months of bank statements instead of 12?
Not on the HELOC we use. Only the most recent 12 months count, even if the year before was stronger, so run the math before you apply.
Choosing the Right Path
Should I use a bank statement HELOC or a bank statement cash out refinance?
If your first mortgage rate is lower than today's rates, a HELOC usually wins, because it leaves that rate alone and only the new money carries a new rate. A cash out refinance replaces your whole first mortgage at today's rate, which can make sense when your current rate is already higher or you want one fixed payment.
Should I qualify on bank statements or with my tax returns?
Run both. If your tax returns already show enough income, a full documentation HELOC asks for less explanation of individual deposits and may price better. Bank statements win when write offs, depreciation or retained earnings make the returns look smaller than the business really is. A loan expert can figure your income both ways before you choose.
Sources and Editorial Review
- Georgia Rules, Chapter 560-11-8, Intangible Recording Tax
- Supreme Court of Georgia, In re UPL Advisory Opinion 2003-2 (November 10, 2003)
- Consumer Financial Protection Bureau, Regulation Z, 12 CFR 1026.15, Right of Rescission
Georgia and federal rules cited on this page: O.C.G.A. 48-6-61; Georgia Department of Revenue Rule 560-11-8; In re UPL Advisory Opinion 2003-2, 277 Ga. 472 (2003); Regulation Z, 12 CFR 1026.15. Program figures reflect the program we use as of October 2026.
Reviewed by Coby Pegues, NMLS 2556341. November 2026.
Ready When You Are
See What Your Deposits Can Unlock
Tell us roughly what the business deposits, what your home is worth and what you owe. A loan expert runs the income math, shows you the line it supports and says plainly when another path fits better.
- Clear next steps
- Options explained before you proceed
Disclosures
General mortgage disclosure
This page is for educational purposes and is not a commitment to lend, an offer of credit, or an approval. Program requirements may vary. Eligibility depends on the complete borrower profile and is subject to underwriting approval. Additional requirements may apply. Examples are illustrations only.
Home equity disclosure
A home equity line of credit is secured by your property. Failure to meet the obligations of the loan can put the property at risk. Variable rates and payments can rise, and the payment increases when the interest only draw period ends. The line amount and the cash available at closing depend on the appraised value and the final line amount approved. Closing costs apply. Tax treatment of interest depends on the borrower's situation; consult a qualified tax professional regarding deductibility. Terms, availability, and line amounts are subject to program requirements and underwriting approval and may change without notice.
Licensing information
Coby Pegues, NMLS 2556341 · UHome Mortgage LLC, Company NMLS 2559453
Licensed in Georgia, Alabama, and Texas.
Equal Housing Opportunity
Equal Housing Opportunity.
