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in Sacramento, CA
Both loans skip traditional income verification. That's where the similarity ends.
Sacramento's mix of self-employed professionals and rental investors makes both programs relevant here. Picking the wrong one costs you time and money.
Bank Statement loans qualify you on cash flow, not tax returns. Lenders look at 12 to 24 months of deposits instead.
This works because self-employed borrowers write off expenses aggressively. Tax returns make income look small. Bank statements show what actually hits your account.
DSCR loans ignore your personal income entirely. Approval is based on whether the rental property pays for itself.
Lenders calculate a DSCR ratio — monthly rent divided by monthly debt. A ratio of 1.0 means the property breaks even. Most lenders want 1.1 or higher.
Bank Statement loans are tied to your personal income picture. DSCR loans are tied to the property's numbers. Different collateral, different underwriting logic.
DSCR loans typically allow more properties without income caps. Bank Statement loans have personal debt-to-income limits that tighten as you add more properties.
Buying a primary residence or second home in Sacramento? Bank Statement is your path if you're self-employed and can't show clean tax returns.
Buying a Sacramento rental — single-family, small multi, or short-term rental? Run the DSCR numbers first. If the property cash flows, you likely qualify without touching your personal returns.
No. DSCR loans are for investment properties only. For a primary residence, you'd need a Bank Statement loan or another program.
Most lenders want at least a 620 score, and better terms start around 680. Credit still matters even without tax returns.
Most lenders require 1.1 or higher. Some allow 1.0 with a stronger down payment or credit score.
Yes. Some borrowers use a Bank Statement loan for a primary home and a DSCR loan for a rental — both close concurrently.
Both typically require 20–25% down. DSCR loans sometimes require more for short-term rental properties.
DSCR loans work well for 2–4 unit rentals. Bank Statement loans can cover multi-units only if it's your primary residence.