Question 1

What DSCR do I need to qualify in Clayton?

Accepted Answer

Most lenders require 1.0 or higher, meaning rent covers the full mortgage payment. Some allow 0.75-0.9 with larger down payments or reserve requirements.

Question 2

Can I use projected rent or does it need tenants?

Accepted Answer

Lenders use a rental appraisal showing market rent, not actual lease terms. You don't need tenants in place to qualify.

Question 3

Do DSCR loans work for multi-family properties?

Accepted Answer

Yes, up to four units. Lenders aggregate rents across all units to calculate the total debt service coverage ratio.

Question 4

How much higher are DSCR loan rates?

Accepted Answer

Expect 1-2% above conventional rates. Rates vary by borrower profile and market conditions — shopping lenders matters here.

Question 5

Can I buy a Clayton property in an LLC with DSCR?

Accepted Answer

Yes, most DSCR lenders allow LLC ownership. You personally guarantee the loan but title vests in the entity.

DSCR Loans in Clayton, CA — Qualify by Rental Income, Not Your W-2