Loading
in Coalinga, CA
Coalinga investors face a clear fork: long-term rental financing or fast flip capital. DSCR loans fund based on rent, not your W-2. Hard money loans fund based on property value, not your credit.
Most Coalinga deals need one or the other, rarely both. DSCR works when cash flow pays the mortgage. Hard money works when speed or condition blocks traditional lending.
DSCR loans ignore your tax returns and focus on one number: monthly rent divided by monthly mortgage payment. You need that ratio above 1.0, sometimes 1.25. Most Coalinga rentals hit these targets without trouble.
Expect 20-25% down, rates 1-2% above conventional, and 30-year terms. These loans close in 3-4 weeks. You hold them long-term while tenants cover your payment.
Hard money lenders fund based on after-repair value, not current condition. They advance 65-75% of ARV, sometimes in 7-10 days. Credit scores matter less than exit strategy and equity cushion.
Terms run 6-18 months at 9-14% interest. You pay points upfront, usually 2-4. These loans work for flips, major rehabs, or bridge financing when you need fast cash.
DSCR loans cost less and last longer. Hard money loans close faster and ignore property condition. DSCR requires stable rent rolls. Hard money requires clear exit plans.
Rate spread tells the story: DSCR runs 7-9%, hard money runs 10-14%. DSCR needs 1.0+ cash flow ratio. Hard money needs 25-35% equity buffer. Pick based on your timeline and strategy.
Buy-and-hold investors in Coalinga use DSCR loans. The rental income qualifies you, rates stay manageable, and 30-year terms match rental strategy. This works when the property already generates rent or will within 30 days.
Flip investors or distressed buyers use hard money. You need speed, the property needs work, or your credit blocks other options. Plan your renovation budget and exit before you sign. Most Coalinga flippers refinance into DSCR loans or sell within 12 months.
Minor repairs work if the property is rentable now. Major rehabs require hard money first, then refinance into DSCR after stabilization.
DSCR lenders want 620-680 minimum. Hard money lenders care less about credit, focusing on equity and exit strategy instead.
Experienced hard money lenders close in 7-10 days with clean title. Complex deals or title issues add time.
Yes, most investors do this. Complete renovations, stabilize rent, then refinance into lower DSCR rates for long-term hold.
DSCR loans welcome out-of-state buyers using rental income. Hard money works too but requires strong local contractor relationships for rehabs.