DSCR vs Bank Statement Loans
Two of the most popular non-QM programs — each designed for different borrower profiles.
Overview
DSCR and bank statement loans are both non-QM programs that avoid traditional income verification, but they work very differently. DSCR qualifies based on property rental income and is only for investment properties. Bank statement loans use personal/business bank deposits to verify income and work for any property type.
Side-by-Side Comparison
| Feature | DSCR Loans | Bank Statement Loans |
|---|---|---|
| Income Verification | Property cash flow (rent vs PITIA) | 12-24 months of bank statement deposits |
| Property Types | Investment property only | Primary, second home, investment |
| Entity Vesting | LLC/entity vesting allowed | Personal name (usually) |
| Min Down Payment | 20-25% | 10-20% |
| Min Credit Score | 620-680 | 620-680 |
| Employment Verification | Not required | 2+ years self-employed |
| Best For | Investors scaling a rental portfolio | Self-employed buying any property |
| Interest-Only Available | Yes | Some programs |
Choose DSCR Loans If…
- You're buying an investment/rental property
- You want to qualify without any personal income docs
- You want to close in an LLC or entity
- You're scaling a portfolio with no limit on properties
Choose Bank Statement Loans If…
- You're buying a primary residence or second home
- You're self-employed with strong bank deposits
- Your tax returns understate your real income
- You want a lower down payment option (10-15%)
The Bottom Line
If you're buying an investment property and want no personal income verification, DSCR is the right choice. If you're self-employed and buying any property type, bank statement loans give you the most flexibility. Many investors use both programs across their portfolio.
Common Questions
No. DSCR loans are strictly for non-owner-occupied investment properties. Use bank statement loans for primary residences.