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in Livingston, CA
Livingston's rental market attracts both self-employed locals and remote investors. Bank statement loans work for owner-occupied purchases, while DSCR loans fund investment properties based purely on rent.
Both are non-QM products that skip W-2 verification. The right choice depends on whether you're buying your primary residence or adding a rental to your portfolio.
Bank statement loans use 12 to 24 months of business or personal bank deposits to calculate income. Underwriters apply a percentage to average deposits—typically 50% for business accounts, 75% for personal accounts.
This works for self-employed borrowers buying a home they'll live in. Rates run 1-2% higher than conventional, and you'll need 10-20% down depending on credit and cash flow.
Livingston business owners—contractors, ag service providers, truckers—use these when tax returns show low net income after deductions. Your bank activity tells the real story of what you earn.
DSCR loans qualify you based on a property's rental income, not your personal income. Underwriters calculate a debt service coverage ratio: monthly rent divided by total monthly housing payment.
A DSCR of 1.0 means rent covers the mortgage payment exactly. Most lenders want 1.0 to 1.25, though some approve lower ratios with larger down payments or higher rates.
You never submit tax returns, pay stubs, or employment letters. The property's rent is the only income source that matters, making this ideal for investors with multiple rentals or complex tax situations.
Bank statement loans require proof of your business or personal cash flow. DSCR loans ignore your income entirely and focus on the property's rent-to-payment ratio.
Bank statement works for primary residences and second homes. DSCR is strictly for investment properties—you cannot live in the home.
DSCR rates tend to run slightly higher than bank statement loans because the underwriting is purely asset-based. Both require reserves—expect 6-12 months of mortgage payments in the bank at closing.
Choose bank statement if you're self-employed and buying a home to live in. Your deposits prove you can afford the payment, and you want owner-occupied rates.
Choose DSCR if you're buying a rental and want the simplest approval path. No tax returns, no explanation of income sources—just show the rent covers the mortgage.
Some Livingston investors use DSCR for out-of-state rentals where local lenders don't know the market. The property qualifies itself, so California brokers can finance anywhere.
No. Bank statement loans are for owner-occupied or second homes only. Investment properties require DSCR or another investor-focused product.
Yes. Most DSCR lenders want 660 minimum, though some go to 620 with higher rates and bigger down payments. Credit still matters even without income verification.
Underwriters average 12 or 24 months, so sporadic months smooth out. But if you have multiple negative balance days, that raises flags about cash management.
Some lenders approve DSCR below 1.0 with 25-30% down. You'll pay higher rates, but it works for value-add rentals you plan to improve.
DSCR typically closes faster. No personal income docs means less back-and-forth. Bank statement loans need time to review deposits and calculate income.