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in Atherton, CA
Atherton's luxury real estate market attracts sophisticated investors and self-employed professionals who need flexible financing. Traditional income documentation doesn't always work for high-net-worth individuals managing complex financial portfolios.
Bank Statement and DSCR loans both offer non-QM solutions, but they serve different purposes. One focuses on your business income, while the other qualifies you based purely on rental property performance.
Understanding which option aligns with your financial situation can streamline your path to securing premium Atherton properties. Rates vary by borrower profile and market conditions.
Bank Statement loans verify income through 12 to 24 months of personal or business bank deposits. Lenders analyze your cash flow patterns to determine qualifying income, making this ideal for self-employed borrowers with strong revenue.
These loans work particularly well for business owners, consultants, and entrepreneurs in Atherton's tech-driven economy. Your bank statements become your income proof instead of tax returns that may show lower adjusted income.
You'll need consistent deposits and typically a credit score of 680 or higher. Down payments usually start at 10-20%, depending on the property type and your overall financial profile.
DSCR loans qualify you based on a property's rental income, not your personal earnings. Lenders calculate the debt service coverage ratio by dividing monthly rent by the monthly mortgage payment (including taxes and insurance).
This product targets real estate investors who want to expand their portfolios without personal income verification. Your W-2, tax returns, and employment history don't factor into approval—only the property's rental performance matters.
Most lenders require a DSCR of 1.0 or higher, meaning rent covers or exceeds the mortgage payment. These loans work for both long-term rentals and investment properties throughout San Mateo County.
The fundamental difference lies in what qualifies you. Bank Statement loans assess your business or personal cash flow, while DSCR loans evaluate only the investment property's rental income potential.
Bank Statement loans suit owner-occupied purchases or second homes where you'll live in the property. DSCR loans are strictly for investment properties generating rental income—you cannot occupy a DSCR-financed home.
Credit and down payment requirements differ slightly. Bank Statement loans typically need 10-20% down for primary residences, while DSCR loans often require 20-25% down since they carry investment property risk.
Documentation burden varies significantly. Bank Statement loans require months of financial statements and explanation of deposits. DSCR loans need a rental analysis and lease agreement but skip personal income verification entirely.
Choose Bank Statement loans if you're self-employed and purchasing a primary residence, second home, or investment property in Atherton. This option works when you have strong cash flow but tax write-offs reduce your documented income.
DSCR loans make sense for investors focused on building rental portfolios without tying up personal income documentation. If you already own rentals and want to scale quickly, DSCR financing lets you qualify on property performance alone.
Many Atherton investors use Bank Statement loans for personal residences and DSCR loans for their rental properties. Your mortgage broker can help determine which product—or combination—maximizes your purchasing power across different property types.
Yes, Bank Statement loans work for investment properties, second homes, and primary residences. Unlike DSCR loans, they verify your personal or business income rather than the rental property's cash flow.
Most lenders require a minimum 1.0 DSCR, meaning monthly rent equals or exceeds the mortgage payment. Higher ratios may qualify for better terms. Rates vary by borrower profile and market conditions.
Bank Statement loans often allow 10-20% down for primary residences, while DSCR loans typically require 20-25% down since they finance investment properties with higher risk profiles.
Bank Statement loans specifically avoid tax returns, using bank deposits instead. DSCR loans also skip personal tax returns since qualification depends entirely on the property's rental income.
Absolutely. Many investors use Bank Statement loans for personal residences and DSCR loans for rental properties. SRK Capital can structure both products to optimize your overall real estate strategy.