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Profit and Loss in Real Estate: Unveiling the P&L Loan Program

P&L refers to Profit & Loss.

For P&L loan program, Borrower’s CPA will provide the following documents to lender to verify the borrower’s ability to repay the loan:

-24 months of Profit & Loss

-CPA letter

-2 years of Business License

-Self-employed borrowers only.

A "P&L loan program" typically refers to a type of mortgage or loan program that allows borrowers to qualify for a loan based on their profit and loss (P&L) statement or business cash flow, rather than traditional income documentation such as tax returns or 1099/W-2 forms. These programs are often used by self-employed individuals, business owners, or those with variable income who may not have the conventional documentation required for traditional mortgage loans.

Here are the key features of a P&L loan program:

Income Verification: Instead of relying on traditional income documentation, lenders assess a borrower's income and ability to repay the loan by examining their P&L statements or business cash flow. These documents provide a snapshot of the borrower's financial performance over a specified period, typically the past 12 to 24 months.

For more information or to go over your own scenario, please contact mc at 408-393-2068

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