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in Dublin, CA
Dublin investors have two distinct financing paths for rental properties and rehab projects. DSCR loans offer long-term rental property financing based on property income, while hard money loans provide quick capital for acquisitions and renovations.
Both options skip traditional employment verification, but they serve different investment strategies. Understanding these differences helps you match the right loan to your Dublin property plans.
DSCR loans qualify investors based on a property's rental income, not personal earnings. Lenders calculate the debt service coverage ratio by dividing monthly rent by the mortgage payment, typically requiring a ratio of 1.0 or higher.
These loans feature 30-year terms with fixed or adjustable rates. Dublin investors use DSCR financing for buy-and-hold rentals, allowing them to expand portfolios without hitting traditional income limits.
Expect 20-25% down payments and closing timelines of 3-4 weeks. Rates vary by borrower profile and market conditions, but DSCR loans generally cost less than hard money options over the long term.
Hard money loans prioritize property value and exit strategy over borrower financials. These short-term loans typically run 6-24 months, providing fast capital for Dublin investors acquiring fixer-uppers or competing in tight markets.
Approval can happen in days, with funding in 1-2 weeks. Lenders focus on after-repair value rather than current condition, making hard money ideal for properties that won't qualify for traditional financing.
Interest rates run higher than conventional loans, and many require interest-only payments. Dublin investors typically use hard money for fix-and-flip projects or bridge financing until they can refinance into permanent loans.
Timeline separates these options dramatically. DSCR loans take 3-4 weeks to close, while hard money can fund in days. If you're competing for a Dublin property against cash buyers, hard money's speed provides an edge.
Cost structures differ significantly. DSCR loans offer lower rates with 30-year amortization, reducing monthly payments. Hard money charges higher rates with short payoff timelines, increasing carrying costs but providing flexibility for quick renovations.
Qualification criteria diverge at the core. DSCR lenders analyze rental income and property cash flow. Hard money lenders evaluate asset value and your renovation experience, caring less about ongoing income verification.
Choose DSCR loans when acquiring Dublin rental properties you plan to hold long-term. The lower rates and longer terms make sense for cash-flowing rentals where you'll keep tenants for years.
Select hard money for fix-and-flip projects or properties needing significant work. If your Dublin investment requires renovation before it can generate rental income or qualify for permanent financing, hard money bridges that gap.
Some investors use both strategically: hard money for acquisition and rehab, then refinance into a DSCR loan once the property is rent-ready. This approach maximizes speed initially while securing better long-term financing after improvements add value.
DSCR loans work for rental properties generating income, not flips. These loans require lease agreements and rental cash flow. Fix-and-flip investors should use hard money instead.
Hard money loans can close in 1-2 weeks with straightforward deals. Speed depends on property condition, title work, and your experience. Some lenders approve in 48-72 hours.
DSCR loans typically offer lower rates than hard money. Rates vary by borrower profile and market conditions. Hard money costs more but provides speed and flexibility.
No, hard money lenders focus on property value and your exit strategy. They care about after-repair value and your plan to repay, not current rental income.
Yes, many investors use this strategy. Complete renovations with hard money, lease the property, then refinance into a DSCR loan for better long-term rates and terms.