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in Petaluma, CA
Petaluma's strong rental market and diverse property mix create opportunities for both self-employed buyers and real estate investors. Most borrowers in either category can't use traditional mortgages.
Bank statement loans qualify you based on personal deposits. DSCR loans qualify you based on rental income from the property itself.
The right choice depends on whether you're buying your residence or an investment property. Your income structure matters less than how you plan to use the home.
Bank statement loans replace W-2s and tax returns with 12 to 24 months of business or personal bank deposits. We calculate your income based on average monthly deposits.
Most lenders require 15-20% down for primary residences. Credit scores typically need to be 620 or higher, though some programs start at 600.
These work for self-employed Petaluma business owners buying their own homes. Consultants, contractors, and gig workers who write off most income on taxes see the biggest benefit.
DSCR loans ignore your personal income completely. Lenders calculate the property's monthly rent divided by its monthly mortgage payment to get the debt service coverage ratio.
Most programs require ratios above 1.0, meaning rent covers the full payment. Some allow ratios as low as 0.75 with larger down payments, typically 20-25%.
These loans fit investors buying rental properties in Petaluma. Your W-2 job, business income, and tax returns don't matter—only what the property can generate in rent.
Bank statement loans look at you. DSCR loans look at the property. That's the fundamental split.
Bank statement borrowers need solid personal cash flow through their accounts. DSCR borrowers need properties that generate strong rents relative to the purchase price.
Interest rates on both run 1-2% higher than conventional mortgages. DSCR rates tend to be slightly lower because the property income provides measurable security.
Bank statement loans allow primary residence, second home, and investment properties. DSCR loans are investment-only—you can't live in a DSCR-financed property.
Use a bank statement loan if you're self-employed and buying your own Petaluma home. Your bank deposits prove you can afford the payment even if your tax returns show minimal income.
Use a DSCR loan if you're buying rental property and want to avoid personal income documentation. This works whether you're a W-2 employee or business owner—your income structure is irrelevant.
Some investors buying rentals could technically use either loan. DSCR makes more sense because it keeps your personal finances separate and often delivers better rates.
If you need both—a home for yourself and rental properties—you might use bank statement for your residence and DSCR for investments. They solve different problems.
No. DSCR loans are strictly for investment properties that generate rental income. For your primary residence, consider bank statement loans instead.
DSCR loans typically run 0.25-0.5% lower than bank statement loans. Both carry higher rates than conventional mortgages due to their non-QM structure.
Bank statement loans replace tax returns with deposits. DSCR loans don't require your personal tax returns at all—they focus solely on property income.
Most bank statement and DSCR programs require 620-640 minimum credit scores. Higher scores unlock better rates and lower down payment requirements.
Yes. DSCR loans are designed for portfolio investors. Each property qualifies independently based on its own rental income and debt coverage ratio.