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in Paradise, CA
Paradise is rebuilding. That creates two very different buyer profiles — owner-occupants and investors.
Conventional loans serve buyers moving in. DSCR loans serve investors buying rental income.
Conventional loans require a 620 minimum credit score. Put 20% down and you skip mortgage insurance entirely.
These loans use your personal income to qualify. W-2s, tax returns, and pay stubs are standard docs.
DSCR loans skip your personal income entirely. Lenders look at rent versus the monthly loan payment.
A DSCR of 1.0 means rent covers the payment. Most lenders want 1.1 or higher to approve the deal.
Local decision guide
Use this comparison to weigh Conventional Loans and DSCR Loans through local payment fit, eligibility, documentation, and timing before choosing a path in Paradise.
Paradise is rebuilding. That creates two very different buyer profiles — owner-occupants and investors.
Conventional loans serve buyers moving in. DSCR loans serve investors buying rental income.
Conventional loans require a 620 minimum credit score. Put 20% down and you skip mortgage insurance entirely.
HousingWire flagged the 30-year fixed at 6.57% — DSCR rates run higher than that. Know your spread.
Conventional loans cap out at conforming limits. DSCR loans can go higher but carry stricter reserve requirements.
Down payment is the other split. Conventional allows 3% down for owner-occupants. DSCR typically needs 20-25%.
Moving into the home? Conventional is the clear call. Better rates, lower down payment, simpler approval.
Buying a rental in Paradise? DSCR removes the income hurdle. Your personal tax returns stay out of the file.
Some investors use conventional for a first rental. Once you hit Fannie's limit on financed properties, DSCR becomes the only path.
No. DSCR loans are for investment properties only. Use conventional financing for a home you plan to live in.
Most DSCR lenders want 660 or higher. Stronger scores get better rates and lower reserve requirements.
It can. Lenders may flag fire-prone areas and require additional insurance. Ask us before you make an offer.
Divide the monthly rent by the total loan payment. A ratio above 1.0 means the rent covers the debt.
Conventional loans close faster when income is clean and credit is strong. DSCR skips income review but adds investor underwriting layers.