A CPA letter for a bank statement loan is a signed letter from the borrower's accountant that confirms the business exists, the borrower owns it and has run it for a stated time. Many lenders also ask it to state the business's expense ratio. A licensed CPA usually signs it, and the lender checks the license.
What does a CPA letter for a bank statement loan confirm?
A CPA letter for a bank statement loan confirms facts about the borrower's business that the statements cannot show: the business name, the borrower's ownership percentage, how long the borrower has been in business and, when the lender allows it, the share of revenue that goes to expenses. The letter backs the deposits the lender will count.
Why the lender asks for it
Bank statements show money moving. They do not show whose business earned it, how long it has operated or how much of each deposit is spent on costs. A lender that averages deposits as income needs an independent professional to speak to those points. The accountant has seen the books, so the lender treats the accountant as a witness.
The five items most letters carry
- The business name exactly as it appears on the statements and the registration.
- The borrower's ownership percentage. A partner or co-owner affects whose income the deposits are.
- Years in business. Many programs set a minimum, often two years, though each lender decides.
- The expense ratio. The share of gross revenue that goes to business expenses.
- The preparer's license details, including the number, the state and a phone number or other way to reach the office.
Why the expense ratio matters
Deposits are gross money. A lender that counts them all as income overstates what the borrower earns, so it applies an expense factor. When the CPA states a lower expense ratio than the lender's default, qualifying income rises. The expense ratio is the part of the letter that changes the loan amount, which is why lenders read it closely. How the CPA figure compares with a fixed factor is covered in CPA expense ratios versus the default expense factor.
An annotated sample outline
The outline below shows how a letter is commonly organized. All names and figures are examples. Use the lender's own template when it supplies one.
| Part of the letter | Example text | What the underwriter checks |
|---|---|---|
| Letterhead | Example CPA Firm, address, phone | The firm exists and can be reached |
| Date | October 1, 2026 | The letter is recent |
| Business name | Example Landscaping LLC | Matches the bank statements |
| Ownership | "The borrower owns 100 percent of the business." | The deposits belong to the borrower |
| Years in business | "In business since March 2021, more than 5 years." | Meets the program minimum |
| Expense ratio | "Expenses are approximately 35 percent of gross revenue." | Used in place of the default factor |
| Basis | "Based on review of the business's financial records." | The CPA has a basis |
| License | "CPA license number 000000, State of Example" | The license can be verified |
| Signature | Signed and dated | The CPA stands behind the letter |
Keep the language plain. A letter that says what the CPA reviewed and what the CPA concludes gives the underwriter little to question.
Who can sign a bank statement loan CPA letter?
A licensed certified public accountant (CPA) can sign a bank statement loan CPA letter. The CPA should hold an active license in good standing and should know the borrower's finances, usually because the CPA prepares the business's tax returns. Lenders set the final rule on who else may sign.
What lenders look for in a signer
- An active license. The lender will check it.
- A real relationship. The CPA prepares the taxes or keeps the books, so the CPA knows the numbers.
- Independence. A relative who happens to hold a license is a problem. Many lenders refuse a letter from a family member or from the borrower.
- Contact details. The lender may call the office.
Others who may sign
Some guidelines accept other licensed professionals in place of a CPA, and some do not. The next section covers tax preparers. The safest approach is to read the lender's guideline or ask the account executive before ordering the letter.
The borrower's own accountant
If the borrower's CPA has not prepared the borrower's returns for the last two years, the lender may ask why. A CPA who has just met the borrower has less basis to sign, and the letter may carry less weight.
Cost and time
CPAs often charge for the letter, and their schedule may slow the file. Ask for it early, especially during tax season, when accountants are busy. A letter that arrives late is a common cause of delay.
CPA letter wording lenders reject
Lenders reject CPA letter wording that is vague, unsupported or inconsistent with the rest of the file. A letter that says only "the borrower is self-employed" gives the underwriter nothing to verify. The fix is almost always to restate the same facts more precisely.
Wording that gets sent back
- "To whom it may concern" with no business named. The letter has to tie to a specific business.
- A range with no number, such as "expenses are low." The underwriter needs a figure.
- An expense ratio with no basis. The letter says 20 percent but not what the CPA reviewed.
- Ownership that does not match the file. The letter says 100 percent and the operating agreement says 50.
- A different business name from the statements.
- No license number, or a number that cannot be found.
- A disclaimer that cancels the content, such as "this letter is not to be relied on."
- A missing signature or date.
Two versions of the same sentence
Rejected: "The borrower runs a successful business and has for a long time."
Accepted: "I have prepared the tax returns of Example Landscaping LLC for the tax years 2021 through 2025. The borrower owns 100 percent of the business, which has operated since March 2021."
The second version names the business, the years, the CPA's role and the ownership. The wording is example language, not a template that every lender takes.
Match the letter to the file
Before the letter goes in, read it against the application and the statements. The business name, the years and the ownership share must agree with them. A letter that is correct on its own but conflicts with another document still produces a condition. The collection checklist for home loan statements helps with the statements side of that check.
Tax preparer letters in place of a CPA letter
A tax preparer letter comes from a person who prepares tax returns but is not a CPA, such as an enrolled agent or a paid preparer. Some lenders accept it in place of a CPA letter, and some require a CPA. The lender's guideline decides, so the borrower should ask before ordering.
Why lenders differ
A CPA holds a state license, and the state board can confirm it. A paid preparer may hold no state license, and the credential can be harder to check. Lenders that accept a preparer's letter often add conditions, such as a preparer tax identification number, proof the preparer filed the returns or a longer relationship.
When a preparer letter works
A preparer letter is most likely to work when the lender's guidelines name preparers as acceptable, the preparer filed the borrower's returns and the letter says the same things a CPA letter would. If the guideline is silent, ask the account executive in writing and keep the answer.
When to switch to a CPA
If the preparer's letter is rejected, the quickest fix may be to hire a CPA for a one-time review and letter. That costs money and takes time, but it is faster than a second rejection.
Verifying the CPA letter before closing
Underwriters verify a CPA letter by checking the license, confirming the firm is real and sometimes calling the office. The verification can happen late, near closing, so a problem found then delays the loan. The broker can run the same checks first.
What the lender checks
- The license. The state board of accountancy keeps a public license lookup. The lender confirms the name, number and status.
- The firm. The address and phone match a real office.
- The contact. The lender may call or email the office to confirm the CPA signed the letter.
- The consistency. The letter agrees with the tax returns, the statements and the application.
What a broker can do first
Look up the license yourself. Call the office and ask the CPA to confirm the letter. Compare the expense ratio with the borrower's tax returns. If the numbers diverge, ask the CPA to explain before the underwriter finds out. A CPA who cannot back a figure should change it, not defend it.
Watch the date
A letter has a shelf life. Many lenders want it dated within a limited number of days before closing. If the file runs long, the letter may need to be reissued, so ask the CPA how quickly they can turn a new one.
Where the numbers meet the statements
The expense ratio in the letter should be consistent with what the bank statements show. A lending team can use TrueBankFlow to total deposits by month and sort each transaction into categories, so a stated 35 percent can be compared with the spending on the statements. The comparison supports the underwriter's judgment and does not replace it. See how it works or read about how many months of statements to collect and which loans accept just three months.