Question 1

Can I use a DSCR loan for a property I plan to live in?

Accepted Answer

No. DSCR loans are investment-only. Owner-occupied properties require conventional or government-backed financing.

Question 2

What credit score do I need for a DSCR loan?

Accepted Answer

Most DSCR lenders want a 680 minimum. Some go to 660, but expect a higher rate at the lower end.

Question 3

Does a conventional loan work if I'm self-employed?

Accepted Answer

Yes, but you'll need two years of tax returns. Low reported income on returns can cap what you qualify for.

Question 4

Can I buy under an LLC with a DSCR loan?

Accepted Answer

Yes — most DSCR lenders allow LLC vesting. Conventional loans do not permit LLC ownership on residential properties.

Question 5

Which loan type has the lower interest rate?

Accepted Answer

Conventional loans carry lower rates in most scenarios. DSCR loans price higher due to investor-loan risk. Rates vary by borrower profile and market conditions.

Question 6

How does a lender calculate DSCR for a Berkeley rental?

Accepted Answer

Divide the monthly market rent by the full mortgage payment. A $4,000 rent on a $3,800 payment gives you a 1.05 DSCR — most lenders accept that.

Conventional vs DSCR Loans in Berkeley, CA