Question 1

Can I use a bank statement loan for a rental property in Santa Monica?

Accepted Answer

Yes, bank statement loans work for rentals. You'll still need to document your personal income through deposits, but it's a solid option if DSCR ratios don't work.

Question 2

Which loan has lower rates, bank statement or DSCR?

Accepted Answer

Bank statement loans typically price 0.25% to 0.50% lower. Rates vary by borrower profile and market conditions, but DSCR adds premium for no income verification.

Question 3

Do I need the same down payment for both loan types?

Accepted Answer

Both start around 15-20% down. DSCR often requires 20% minimum for best pricing, while bank statements can go as low as 10% for primary homes.

Question 4

Can I avoid showing tax returns with both options?

Accepted Answer

Yes, neither loan requires tax returns. Bank statements use deposit history; DSCR uses a rent schedule or appraisal's income analysis.

Question 5

Which loan closes faster in Santa Monica?

Accepted Answer

DSCR loans close faster because lenders skip all personal income verification. Bank statement loans need 12-24 months of statements reviewed and calculated.

Bank Statement vs DSCR Loans in Santa Monica: Which Non-QM Option Fits Your Investment Strategy?