Question 1

Can I use a bank statement loan for a rental property?

Accepted Answer

Yes, but DSCR usually makes more sense. Bank statement loans work for rentals, but you still need to show personal income through deposits.

Question 2

Do DSCR loans require tax returns?

Accepted Answer

No. DSCR loans qualify on the property's rent alone. Lenders don't review your personal tax returns or employment history.

Question 3

Which loan type has better rates?

Accepted Answer

Rates vary by borrower profile and market conditions. DSCR rates typically run slightly lower if your DSCR ratio exceeds 1.25.

Question 4

Can I refinance from one to the other?

Accepted Answer

Yes. Investors often refi from bank statement to DSCR once they convert a property to a rental and establish rental income history.

Question 5

What credit score do I need for each?

Accepted Answer

Bank statement loans start around 620. DSCR loans typically require 660 minimum, sometimes higher depending on the lender and DSCR ratio.

Bank Statement Loans vs DSCR Loans in King City: Which Non-QM Fits Your Deal?