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in Clearlake, CA
Clearlake attracts two types of non-traditional borrowers: self-employed buyers who need a primary residence and investors chasing rental income. Both groups get shut out by conventional lenders who demand W-2s and pay stubs.
Bank statement loans and DSCR loans solve different problems. One qualifies you on your business cash flow. The other ignores your income entirely and underwrites the property instead.
Bank statement loans use 12 to 24 months of personal or business bank deposits to calculate your income. Lenders apply a percentage to your average monthly deposits—usually 50% for personal accounts, 75% for business accounts.
This works for contractors, real estate agents, and business owners buying a home in Clearlake. You need decent credit—typically 620 minimum—and at least 10% down. Rates run 1-2% above conventional because you're non-QM.
DSCR loans ignore your personal income completely. Underwriters look at one number: does the property's rent cover the mortgage payment? A DSCR of 1.0 means rent equals the payment. Most lenders want 1.1 to 1.25.
This loan type exists for investors who own multiple properties or have complicated tax returns. You can close on a Clearlake rental without showing W-2s, pay stubs, or tax returns. Expect 20-25% down and slightly higher rates than bank statement loans.
The fundamental split: bank statement loans qualify you based on your income. DSCR loans qualify the property based on its rent. If you're buying a home to live in, DSCR isn't an option—it's investment-only.
Bank statement loans require lower down payments but scrutinize your deposits and credit history. DSCR loans need bigger down payments but care less about your personal finances. Bank statement rates typically beat DSCR rates by 0.5-1%.
Buying a house to live in? Bank statement loan. You can't use DSCR for primary residences. Self-employed buyers use bank statements when their tax returns show too many deductions.
Buying a rental property in Clearlake? Run the numbers. If the rent covers 110-125% of the projected mortgage payment, DSCR works and you skip the income documentation hassle. If your personal income looks strong on bank statements and you want a lower rate, that route makes sense too.
Yes. Bank statement loans work for investment properties if your personal income qualifies you. DSCR just offers an alternative that ignores your income entirely.
DSCR typically closes faster because you skip income documentation. Bank statement loans need 12-24 months of statements reviewed and underwritten.
Yes. Expect 6-12 months of mortgage reserves for either program. DSCR loans often require more reserves than bank statement loans.
Absolutely. Investors sometimes start with bank statement loans then refinance to DSCR as they accumulate properties and rental history.
Similar minimums around 620-640. DSCR lenders care more about property performance than credit. Bank statement lenders weigh both credit and deposit consistency.