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in Auburn, CA
Auburn's mix of single-family homes and investment properties attracts both self-employed buyers and real estate investors. Each group needs different loan structures to get approved.
Bank statement loans verify income through deposits. DSCR loans ignore your income entirely and focus on rental cash flow. The right choice depends on whether you're buying to live in or rent out.
Bank statement loans use 12 to 24 months of business or personal bank deposits to calculate your income. Lenders average your deposits and apply an expense ratio, typically 25-50%.
You need at least 10% down, credit scores above 620, and consistent deposit patterns. This works for contractors, realtors, and business owners buying homes in Auburn's established neighborhoods.
DSCR loans qualify you based on the property's rental income divided by its monthly debt. A ratio above 1.0 means the rent covers the mortgage. No personal income verification required.
You need 20-25% down, credit above 640, and provable rental income through a lease or rent schedule. Auburn investors use these for single-family rentals and small multifamily properties.
Bank statement loans require proof of personal income through deposits. DSCR loans don't care about your income at all—only what the property generates in rent.
Down payment requirements differ: 10% for bank statement loans, 20-25% for DSCR. Bank statement works for primary residences. DSCR only works for investment properties. You cannot live in a DSCR-financed home.
Choose bank statement loans if you're self-employed and buying a home to live in Auburn. Your business deposits become your qualifying income, and 10% down gets you approved.
Choose DSCR if you're buying Auburn rental property and don't want to show tax returns. The property's rent must cover the mortgage payment, but your personal income stays private. Most Auburn investors prefer DSCR for its simplicity.
Yes, but DSCR loans typically offer better terms for rentals. Bank statement loans work best when you're buying your primary residence as a self-employed borrower.
Most lenders require at least 1.0, meaning rent equals the mortgage payment. Higher ratios above 1.25 unlock better rates and lower down payments.
DSCR loans allow LLC ownership, which most investors prefer for liability protection. Bank statement loans typically require individual ownership for primary residences.
DSCR loans often close faster since they skip income verification. Bank statement loans need 12-24 months of statements reviewed and averaged before approval.
Yes, if you convert your primary residence to a rental. Once the property generates rental income, DSCR refinancing becomes an option.