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in Rohnert Park, CA
Rohnert Park investors and self-employed buyers face the same problem: traditional lenders don't understand your income. Bank statement and DSCR loans both solve this, but they target completely different borrower types.
Bank statement loans verify your personal income through deposits. DSCR loans ignore your income entirely and focus on the property's rental cash flow. Choosing wrong means wasting weeks on a loan that won't close.
Bank statement loans use 12 to 24 months of business or personal bank statements to calculate your qualifying income. Lenders average your monthly deposits, apply a percentage for expenses, and use that number for approval.
This works for contractors, real estate agents, restaurant owners, and anyone with strong cash flow but complex tax returns. You need decent credit (usually 620+) and typical down payments of 10-20%. Rates run 1-2% higher than conventional.
DSCR loans qualify you based on one number: the property's rental income divided by its monthly debt. If the property generates enough rent to cover the mortgage payment, you're approved. Your personal income doesn't enter the equation.
These loans target real estate investors buying rentals in markets like Rohnert Park. You typically need 20-25% down and a DSCR ratio above 1.0 (rent exceeds payment). Some lenders accept ratios as low as 0.75 if you compensate with larger down payments.
The fundamental split: bank statement loans care about your income, DSCR loans care about the property's income. If you're buying a primary residence or second home in Rohnert Park, bank statement is your only option. DSCR only finances investment properties.
Bank statement loans require proving stable deposits over time. DSCR loans need an appraisal with a rental analysis showing the property can cover its payment. Bank statement works for purchase or refinance of any property type. DSCR strictly targets rental investors.
Choose bank statement loans if you're self-employed and buying a home to live in. Also use them if you're an investor with strong personal income but the rental numbers are tight. The underwriter evaluates you, not just the property.
Choose DSCR if you're buying rental property and don't want to provide income docs. This works especially well for investors with multiple properties who'd rather keep personal finances separate. DSCR also helps if your personal debt-to-income ratio is maxed but you're finding cash-flowing deals.
Yes, bank statement loans work for investment properties if you want to qualify using your income. DSCR is usually simpler for investors since it skips personal income review entirely.
Rates vary by borrower profile and market conditions, but they're usually comparable. DSCR rates may edge slightly lower if the property has a strong DSCR ratio above 1.25.
Neither requires tax returns for income verification. Bank statement lenders may request returns to verify self-employment but won't use them for qualifying income calculations.
Most DSCR lenders require 620+ credit scores. Some accept lower scores with larger down payments, but bank statement loans typically offer more credit flexibility.
DSCR loans often close quicker since there's less income documentation. Bank statement loans need 12-24 months of statements analyzed, which adds underwriting time.