Loans
DSCR & Bank Statement Loans
DSCR and bank statement loans are home loans for buyers whose income does not fit the standard documentation. Bank statement loans are a type of non-agency loan: most loans follow the standard rulebooks of Fannie Mae, Freddie Mac, FHA, or VA, and non-agency loans do not, so income can be shown in other ways. “Non-QM” means the loan does not meet the standard rules for a qualified mortgage. Deb Gontko Klein helps self-employed buyers and investors see if one of these loans fits, with the costs in plain view. Serving home buyers in Arizona, California & Colorado since 2004.
Who it helps
- People who work for themselves, whose tax returns show less income than they truly earn.
- Investors buying rental homes, where the rent helps show the loan can be paid.
- Buyers with strong savings or rental income but thin standard income documentation, if you qualify.
Loans if You Work for Yourself
If you work for yourself, you may not have a pay stub, and write-offs may make your tax returns show less than you really earn. Bank statement loans: Instead of tax returns, the lender reviews bank statements over a set period to evaluate your income.
How it works
DSCR loans: DSCR stands for debt service coverage ratio. It compares the rent a property earns with the loan payment. If the rent covers the payment, that can support the loan, if you qualify. Personal income is not evaluated; only the debt service coverage ratio is evaluated.
Other checks: Credit history, savings, and the property itself are still checked. A larger down payment may be needed.
Things to think about
- Non-QM loans can cost more than standard loans. Compare the full cost before you choose.
- Rent estimates must be realistic. If the rent falls short, the payment is still yours to make.
Questions people ask
What does non-QM mean?
A loan that does not meet the standard rules for a qualified mortgage.
What does non-agency mean?
A loan that does not use the standard rulebooks of Fannie Mae, Freddie Mac, FHA, or VA, so income can be shown in other ways, if you qualify.
What is a DSCR loan?
A loan for rental property that compares the rent the property earns with the loan payment, if you qualify.
Can I qualify without tax returns?
A bank statement loan may show income from your bank statements and the money coming in, instead of a pay stub and instead of tax returns, if you qualify. Other checks still apply.
Next step: Work for yourself or investing in rentals? Call Deb at (480) 550-0211 for an honest look at your options, or apply through Planet Home Lending.
Official source: Consumer Financial Protection Bureau: Owning a Home
Get Started
Talk with Deb
Tell us what you want to do, and we will call you back with clear next steps. It takes about a minute. Prefer to talk now? Call (480) 550-0211.
Serving home buyers in Arizona, California & Colorado since 2004