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in Eureka, CA
Self-employed professionals and real estate investors in Eureka face unique challenges when seeking traditional mortgage financing. Bank Statement Loans and DSCR Loans offer alternative qualification paths that skip W-2s and tax returns.
Both are non-QM (non-qualified mortgage) products designed for borrowers who don't fit conventional lending boxes. The right choice depends on whether you're buying a primary residence or an investment property in Humboldt County.
Bank Statement Loans verify income using 12 to 24 months of personal or business bank deposits rather than tax returns. This makes them ideal for Eureka's self-employed workers, freelancers, and business owners who write off significant expenses.
Lenders analyze your deposit patterns to calculate qualifying income, typically using 50-75% of average monthly deposits. You can purchase a primary residence, second home, or investment property with this financing method.
Credit requirements typically start around 620, though higher scores unlock better terms. Down payments usually range from 10-20% depending on property type and occupancy. Rates vary by borrower profile and market conditions.
DSCR Loans qualify borrowers based solely on a rental property's ability to cover its own debt. Lenders calculate the Debt Service Coverage Ratio by dividing monthly rental income by the mortgage payment (including taxes and insurance).
Your personal income, employment, and tax returns never enter the equation. This makes DSCR loans powerful tools for investors building rental portfolios in Eureka and throughout Humboldt County without income limitations.
Most lenders require a DSCR of at least 1.0, meaning rent equals or exceeds the payment. Ratios above 1.25 typically unlock better pricing. Down payments start at 20-25%, with credit scores usually beginning at 620-640.
The fundamental distinction lies in what generates your qualification. Bank Statement Loans examine your personal or business cash flow, making them suitable for any property type. DSCR Loans ignore your income entirely, focusing only on the subject property's rental potential.
If you're self-employed and buying a home to live in near Eureka's Old Town or Myrtletown neighborhoods, Bank Statement is your only option between these two. DSCR financing applies exclusively to investment properties you'll rent out.
Documentation requirements differ significantly. Bank Statement Loans need consecutive months of statements showing consistent deposits. DSCR Loans require a lease agreement or rental appraisal proving the property generates sufficient income to cover its payment.
Choose Bank Statement Loans if you're self-employed and purchasing a home you'll occupy in Eureka or anywhere in Humboldt County. This option works whether you're buying your primary residence, a vacation home, or adding to your rental portfolio.
Select DSCR Loans when acquiring investment properties and you want qualification based purely on rental numbers. This works especially well for investors with substantial existing income who don't want to document it, or those building portfolios beyond conventional loan limits.
Many Eureka investors use both products strategically: Bank Statement Loans for properties requiring owner documentation, and DSCR Loans for pure investment purchases. Your specific tax situation and investment strategy should guide your decision.
Yes, if you're buying an investment property. However, DSCR Loans streamline this process by requiring no personal income verification at all, making them simpler for pure rental investments.
Rates vary by borrower profile and market conditions. Both are non-QM products with comparable pricing tiers. Your credit score, down payment, and loan specifics matter more than the product type.
Neither requires personal tax returns for income qualification. Bank Statement Loans may request business returns if using business accounts. DSCR Loans typically avoid tax returns entirely.
Yes, both Bank Statement and DSCR programs work for refinancing existing properties. The same qualification criteria apply whether you're purchasing or refinancing in Humboldt County.
Bank Statement Loans typically start at 10-15% down for primary residences, 15-20% for investments. DSCR Loans usually require 20-25% down for investment properties. Exact requirements depend on the lender and your profile.