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in Galt, CA
Galt's growing rental market attracts both self-employed buyers and real estate investors. Bank Statement Loans and DSCR Loans serve different financing needs, though both offer flexible qualification options.
Bank Statement Loans work best for self-employed buyers purchasing primary residences or investment properties using their personal income. DSCR Loans focus exclusively on investment properties, qualifying borrowers based solely on the rental income those properties generate.
Bank Statement Loans use 12 to 24 months of personal or business bank statements to document income. Lenders calculate average monthly deposits, then apply an expense factor to determine qualifying income for self-employed borrowers.
These loans work for primary residences, second homes, and investment properties in Galt. They help business owners, freelancers, and 1099 contractors who write off significant expenses that reduce their taxable income on tax returns.
Rates vary by borrower profile and market conditions. Credit score, down payment size, and cash reserves all influence your final terms and pricing.
DSCR Loans qualify borrowers based entirely on the rental property's income potential. Lenders compare the expected monthly rent to the mortgage payment, property taxes, insurance, and HOA fees to calculate the debt service coverage ratio.
These loans only finance investment properties in Galt. Your personal income, employment status, and tax returns don't factor into qualification. The property itself must generate enough rental income to support the loan.
A DSCR of 1.0 or higher means the rent covers all property expenses. Many lenders prefer ratios of 1.25 or higher for better pricing. Rates vary by borrower profile and market conditions.
Bank Statement Loans verify your ability to pay using your business cash flow. DSCR Loans ignore your personal finances completely, focusing only on whether the rental property produces enough income to cover its own expenses.
Down payment requirements differ between programs. Bank Statement Loans typically require 10-20% down depending on property type and use. DSCR Loans usually start at 20-25% down for investment properties.
Your choice depends on your situation. Self-employed buyers purchasing a primary home in Galt need Bank Statement Loans. Investors adding rental properties to their portfolio often prefer DSCR Loans for simpler qualification.
Choose Bank Statement Loans if you're self-employed and buying your primary residence, second home, or expanding your investment portfolio while qualifying on personal income. These loans help when your tax returns don't reflect your true earning capacity.
DSCR Loans make sense for investors focused solely on rental properties. If you own multiple rentals, are building a portfolio, or prefer keeping personal finances separate from investment qualification, DSCR offers the cleanest path.
Some Galt investors use both loan types strategically. They finance owner-occupied properties with Bank Statement Loans and pure rental investments with DSCR Loans. This approach maximizes flexibility across different property types and investment goals.
Yes, Bank Statement Loans work for investment properties. You'll qualify based on your personal bank statement deposits rather than the rental property's income. DSCR Loans use the property's rental income instead.
Rates vary by borrower profile and market conditions. Both are non-QM loans with similar pricing structures. Your credit score, down payment, and specific property details affect your final rate more than the loan type.
Neither loan requires personal tax returns for income qualification. Bank Statement Loans use bank deposits to verify income. DSCR Loans qualify entirely on the rental property's projected or actual income.
Yes, DSCR Loans work well for investors building rental portfolios. Each property qualifies independently based on its own rental income. There's no limit to how many you can have simultaneously.
DSCR Loans typically require less paperwork since they don't verify personal income. Bank Statement Loans need 12-24 months of statements. Both skip W-2s and tax return income verification.