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in Lompoc, CA
Lompoc borrowers who don't fit traditional lending boxes have two powerful non-QM options. Bank Statement Loans work best for self-employed business owners, while DSCR Loans serve real estate investors buying rental properties.
Both programs skip W-2 verification and offer flexible qualification paths. Your choice depends on whether you're buying a primary residence for your business income or an investment property generating rental cash flow.
Understanding the differences helps you choose the right financing tool for your situation in Santa Barbara County's diverse real estate market.
Bank Statement Loans use 12 to 24 months of personal or business bank deposits to calculate your qualifying income. Lenders analyze your cash flow patterns rather than requiring tax returns or pay stubs.
These loans work for self-employed borrowers buying primary residences, second homes, or investment properties. You'll need consistent deposits showing stable business income over the review period.
Rates vary by borrower profile and market conditions. Stronger bank statement patterns and larger down payments typically improve your terms and qualification odds.
DSCR Loans qualify you based solely on a rental property's income potential, not your personal income. The property must generate enough rent to cover the mortgage payment plus expenses.
Lenders calculate the Debt Service Coverage Ratio by dividing projected rental income by the total monthly debt. A DSCR of 1.0 or higher typically qualifies, meaning rent covers the payment.
This program is exclusively for investment properties in Lompoc and throughout Santa Barbara County. You cannot use DSCR financing for owner-occupied homes or second residences.
The fundamental difference is what qualifies you. Bank Statement Loans examine your business cash flow, while DSCR Loans only care about rental income the property will generate.
Bank Statement programs allow any property type including your Lompoc primary residence. DSCR financing strictly serves investors purchasing rental properties, never owner-occupied homes.
Both programs offer flexibility traditional lenders can't match. Bank Statement Loans help business owners show true income capacity. DSCR Loans let investors scale portfolios without personal income limits.
Down payment requirements and rates vary by borrower profile and market conditions for both options. Neither requires W-2s or tax returns showing traditional employment income.
Choose Bank Statement Loans if you're self-employed and buying any type of property in Lompoc. This works whether you run a local business, work as a contractor, or earn 1099 income with inconsistent tax write-offs.
Pick DSCR Loans if you're investing in Lompoc rental properties and want to qualify based on rent potential alone. This strategy works brilliantly for investors with multiple properties or complex personal tax situations.
Some borrowers actually qualify for both programs on the same investment property. In those cases, comparing specific terms helps you choose the better deal for your situation.
A California mortgage broker can analyze your bank statements or property rental projections to determine which path offers stronger approval odds and better terms.
Yes, Bank Statement Loans work for investment properties. However, DSCR Loans might offer easier qualification since they ignore your personal income and focus only on the property's rental potential.
No, DSCR Loans qualify you based entirely on the rental property's income. Lenders don't review your bank statements, tax returns, or employment history for this program.
Both typically require 15-25% down depending on your situation. Bank Statement Loans may allow slightly lower down payments on primary residences compared to DSCR investment property requirements.
Yes, lenders use market rent appraisals to determine income potential. The property doesn't need existing tenants, but the projected rent must support the DSCR calculation.
Most programs require 12 to 24 months of bank statements. Longer review periods with consistent deposits strengthen your application and may improve your terms.