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in Rolling Hills Estates, CA
Rolling Hills Estates buyers choosing non-QM financing face a clear fork: prove income through your bank accounts or let rental cash flow do the talking. Both skip W-2s and tax returns, but they serve completely different borrower profiles.
Bank statement loans target self-employed buyers purchasing primary residences or second homes. DSCR loans exist solely for investment properties where rent covers the mortgage.
Bank statement loans pull income directly from 12 or 24 months of personal or business account deposits. Underwriters calculate average monthly deposits, apply an expense ratio, and arrive at qualifying income without ever touching your tax returns.
You need consistent deposits and reserves to close. Most programs require 10-20% down, credit scores above 620, and six months of payment reserves for higher loan amounts.
DSCR loans ignore your personal income completely. Underwriters divide projected monthly rent by the mortgage payment to get a coverage ratio. A ratio above 1.0 means rent exceeds the payment. Most lenders want 1.0 to 1.25 minimum.
You document the rental income with a lease or appraisal-based market rent estimate. Your tax returns, employment history, and personal cash flow never enter the equation.
The fundamental split is occupancy. Bank statement loans let you live in the property. DSCR loans do not. If you're buying a Rolling Hills Estates home to occupy, bank statement is your only path between these two.
Income verification diverges completely. Bank statement lenders care about your deposits and business health. DSCR lenders only care if rent covers debt. A self-employed buyer purchasing a residence uses bank statements. An investor adding to a rental portfolio uses DSCR.
Choose bank statement loans if you're self-employed and buying a home to live in. Your business generates strong cash flow but tax write-offs crush your qualifying income on conventional loans. This program turns deposits into documented income.
Choose DSCR if you're acquiring rental property and want to scale without personal income limits. The property qualifies itself. Your debt-to-income ratio, employment status, and tax returns never slow you down.
Some programs allow it, but most bank statement lenders prefer owner-occupied or second homes. DSCR makes more sense for pure rentals since it skips personal income entirely.
Rates vary by borrower profile and market conditions. Bank statement loans often price slightly better for strong credit profiles, but DSCR rates stay competitive when the property cash flows well.
Yes. Bank statement lenders typically want 6-12 months of payment reserves. DSCR programs often require similar reserves, especially on larger loan amounts or lower DSCR ratios.
No. You pick one qualification method. Bank statement loans look at your deposits. DSCR loans look at property rent. They don't stack income sources across programs.
Bank statement loans typically start at 620 credit. DSCR programs often accept 640 minimum. Both price better above 680 with materially lower rates at 720-plus.