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in La Puente, CA
La Puente investors and self-employed borrowers often hit a wall with conventional loans. Both bank statement and DSCR loans skip traditional income verification, but they solve different problems.
Bank statement loans work for self-employed buyers who need to live in the property. DSCR loans target pure investors who want the rental income to carry the mortgage.
Bank statement loans let you prove income through 12 to 24 months of business or personal bank deposits. Lenders calculate your average monthly deposits and apply a percentage (typically 50-75%) as qualifying income.
You need decent credit—usually 620 minimum, though 680+ gets better rates. These loans work for primary residences, second homes, or investment properties. Rates vary by borrower profile and market conditions.
DSCR loans qualify you based on one number: the ratio between monthly rent and monthly mortgage payment. If the property generates $2,500 in rent and the mortgage costs $2,000, you have a 1.25 DSCR—which most lenders approve.
Your personal income doesn't matter. Most lenders want 1.0 DSCR or higher, though some approve down to 0.75 with bigger down payments. Investment properties only—you can't live there.
The biggest split: bank statement loans look at your income, DSCR loans look at the property's income. If you're self-employed and want to live in La Puente, bank statement is your only option here. If you're buying a rental and your tax returns show minimal income, DSCR wins.
Down payments differ too. Bank statement loans start around 10-15% down. DSCR loans typically need 20-25%, jumping to 25-30% if the property barely covers the mortgage. Credit requirements run similar—mid-600s minimum for both.
Choose bank statement loans if you're self-employed, show strong deposits, and plan to live in the property. They also work for investors who want flexibility across property types. The income calculation depends on your banking activity, so clean statements help.
Pick DSCR if you're buying a rental property in La Puente and the numbers work. Your job, tax returns, and debt-to-income ratio don't enter the equation. You just need the rent to cover the mortgage and enough cash for the down payment.
Yes, bank statement loans work for investment properties. DSCR might offer better terms if the rental income is strong, but bank statement gives you the option.
Rates vary by borrower profile and market conditions. DSCR rates can be slightly lower when the property has strong cash flow and you bring a bigger down payment.
No. Bank statement loans replace tax returns with deposit records. DSCR loans skip personal income verification entirely and focus on rental income.
Some lenders approve DSCR as low as 0.75, but expect to put 25-30% down. The property needs to get close to breaking even on paper.
Not in one loan. You choose either bank statement underwriting or DSCR underwriting. Some borrowers hold both loan types across different properties in their portfolio.