Question 1

Can I use a DSCR loan to buy a home in Los Gatos to live in?

Accepted Answer

No. DSCR loans are for non-owner-occupied rentals only. You need a bank statement or conventional loan for a primary residence.

Question 2

Do bank statement loans work for rental properties?

Accepted Answer

Yes. Self-employed borrowers can use bank statement loans on investment properties. It's not limited to primary homes.

Question 3

Which loan has stricter credit requirements?

Accepted Answer

Both are non-QM and typically require at least 620–680 credit. DSCR lenders may allow slightly more flexibility since the property qualifies.

Question 4

What does DSCR ratio mean?

Accepted Answer

It compares monthly rent to monthly mortgage payment. A 1.0 ratio means rent exactly covers the payment. Most lenders want 1.0 or higher.

Question 5

Can I use both loans in Los Gatos at the same time?

Accepted Answer

Yes. Some investors use a bank statement loan for their home and DSCR loans for rental properties simultaneously.

Question 6

Which loan closes faster?

Accepted Answer

DSCR loans often close faster since there's no personal income review. Bank statement loans require underwriters to analyze deposit history.

Bank Statement vs DSCR Loans in Los Gatos