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in Murrieta, CA
Murrieta borrowers often need flexible financing beyond traditional mortgages. Both Bank Statement Loans and DSCR Loans offer non-QM solutions for unique situations.
Bank Statement Loans help self-employed borrowers qualify using bank deposits instead of tax returns. DSCR Loans let investors buy rental properties based on the property's income, not personal earnings.
Understanding these two options helps you choose the right path for your Riverside County real estate goals. Each serves different borrower types with distinct qualification methods.
Bank Statement Loans use 12 to 24 months of bank statements to verify income for self-employed borrowers. This works well for business owners whose tax returns don't show their full earning potential.
Lenders review your bank deposits to calculate average monthly income. They typically look for consistent deposits that demonstrate your ability to repay the loan.
These loans benefit freelancers, contractors, and small business owners in Murrieta. Rates vary by borrower profile and market conditions, along with your credit score and down payment.
DSCR Loans qualify investors based on a rental property's income rather than personal income. The property must generate enough rent to cover the mortgage payment.
Lenders calculate the Debt Service Coverage Ratio by dividing monthly rent by the monthly mortgage payment. A ratio above 1.0 means the rent covers the debt.
These loans work perfectly for real estate investors buying rental properties in Murrieta. Your personal income and employment don't matter for qualification purposes. Rates vary by borrower profile and market conditions.
The main difference is who they serve and how they qualify you. Bank Statement Loans are for self-employed people buying primary homes or second homes.
DSCR Loans are strictly for investment properties, not homes you'll live in. They focus on the property's rental income, while Bank Statement Loans focus on your business income.
Documentation differs significantly between the two programs. Bank Statement Loans require personal bank statements and proof of business ownership. DSCR Loans need rental income documentation and property appraisals showing market rent potential.
Choose Bank Statement Loans if you're self-employed and buying a home to live in. They work best when your bank deposits show strong income but your tax returns don't.
Choose DSCR Loans if you're investing in Murrieta rental properties. You don't need to prove personal income, making them ideal for investors with multiple properties or retired investors.
Your situation determines the best fit. Talk to a mortgage broker who understands both programs and the Riverside County market. They can review your specific goals and recommend the right solution.
Some lenders allow Bank Statement Loans for investment properties, but DSCR Loans are typically better suited for investors. DSCR Loans focus solely on rental income without considering your personal finances.
Rates vary by borrower profile and market conditions for both programs. Your credit score, down payment, and specific lender matter more than the loan type when comparing rates.
No, both programs accept lower credit scores than conventional loans. Minimum scores typically start around 600-640, though better credit gets you better terms.
Both typically require 15-25% down, though requirements vary by lender. DSCR Loans may need higher down payments for properties with lower rental income ratios.
Yes, if you're self-employed and buying investment property, you might qualify for both. Your mortgage broker can help determine which offers better terms for your situation.