P&L Only loans: a CPA-prepared profit & loss is your income doc.
Skip the deposit math. If your CPA can produce a current P&L on their letterhead, that's the income document — not a 1040, not a stack of bank statements. Cleaner file, faster close.
Quick answer: what is a P&L Only loan?
- Income source: a third-party-prepared Profit & Loss statement covering 12 or 24 months — typically YTD plus prior year.
- Tax returns required? No.
- Bank statements required? Some investors ask for 2–3 months of business statements as a sanity check. The P&L is the income doc.
- Who it's for: self-employed borrowers with clean books and a CPA or licensed tax preparer who can produce a current P&L.
- Min FICO: typically 660+.
- Down payment: typically 15–25%.
- Self-employment history: 2 years required by most programs.
How it works
- Your CPA or licensed tax preparer prepares the P&L on their letterhead, signed, dated, covering YTD plus prior full year (or 12 / 24 months as the program requires).
- Underwriter takes the net income figure as the qualifying income — no expense haircut, no recasting.
- Some investors require a brief CPA letter stating they prepare the P&L in the normal course of business and the borrower is the owner of the entity.
- Optional sanity check: 2–3 months of business bank statements to confirm deposits roughly match the P&L's revenue line.
Why this is a great program for clean-books borrowers
If your books are accurate and your CPA actually closes them monthly, the P&L is a much cleaner income document than 24 months of bank statements. There's no transfer-back-out, no expense factor argument, no "what's this $4,200 deposit" — the P&L just shows what you made.
P&L Only vs. Bank Statement — when to pick which
| Pick P&L Only when… | Pick Bank Statement when… |
|---|---|
| You have a CPA or licensed tax preparer. | Your books are informal or you self-prepare. |
| Your business has real expenses you want reflected. | Your business is high-margin and expense factor on bank statements would understate income. |
| You prefer one clean document over 24 months of statements. | You don't have a tax preparer who'll sign the P&L. |
| You want to underwrite to your actual net income. | You want to underwrite to cash flow regardless of expense classification. |
What you'll need
- 12 or 24 month P&L on CPA / tax preparer letterhead, signed and dated.
- CPA / tax preparer license number on the letter.
- Optional 2–3 months of business bank statements (program-dependent).
- Business license or 2-year self-employment history documentation.
- Standard mortgage docs.
FAQ
Who can prepare the P&L?
A CPA, EA (enrolled agent), or licensed tax preparer. Their license number must be on the letter. The borrower cannot self-prepare the P&L for this program.
Do you need 12 or 24 months?
Investor-dependent. Most programs accept either; some give better pricing with 24. We pick by file.
Will my P&L need to match my tax return?
Investors don't pull your tax return on a P&L Only program. But the P&L should be consistent with your actual financials — a P&L wildly inflated relative to bank deposits will get flagged in QC.
My business is in its first year. Can I still use P&L Only?
Most P&L Only programs require 2 years of self-employment. With only 1 year, look at the Asset Qualifier program or 1-year tax-return programs.
Do I have to use a specific CPA?
No. Use whoever prepares your books or files your taxes.
Can I use a P&L for a rental purchase?
Non-owner-occupied is typically allowed at adjusted LTV / down payment. For pure rental investment, DSCR is often the easier path.
Ready to see if this is the right program?
Start the application or book a 20-minute call. We'll model real numbers, not estimates.