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in Fowler, CA
Fowler investors face a choice between two non-traditional financing paths. DSCR loans fund rentals based on cash flow, while hard money backs quick flips and rehabs.
Both skip W-2 income verification, but they serve different investment timelines. One builds long-term rental portfolios, the other fuels fast-moving fix-and-flip projects.
DSCR loans qualify you on rental income alone. If the property generates enough rent to cover the mortgage payment, you can get approved without tax returns or pay stubs.
These are 30-year fixed loans with rates typically 1-2% above conventional. You'll need 20-25% down and a credit score around 620-640 minimum.
DSCR works for single-family rentals, small multifamily units, and properties you plan to lease out immediately. The underwriter calculates rent divided by mortgage payment to get your ratio.
Hard money loans fund based on property value, not your finances. Lenders care about the asset and your exit strategy, not your credit score or income.
Terms run 6-24 months with rates between 9-14%. You'll pay 2-5 points upfront and put down 10-30% depending on the deal.
These loans close in 5-10 days, making them ideal when you need to grab a foreclosure or distressed property fast. Most Fowler investors use hard money for properties that need heavy work before they can qualify for traditional financing.
Timeline separates these loans. DSCR closes in 3-4 weeks and you hold for years. Hard money closes in a week and you refinance or sell within months.
Cost structure differs dramatically. DSCR rates run 6-8% with standard closing costs. Hard money charges 9-14% plus hefty points, but you pay it for weeks instead of decades.
Qualification focus varies completely. DSCR underwrites the rental income stream. Hard money underwrites the property's after-repair value and your renovation plan.
Use DSCR when you're buying a rental property in decent shape that you plan to hold. It works for turnkey homes or properties needing only minor cosmetic work before leasing.
Choose hard money when you're flipping or the property won't qualify for traditional financing yet. If you're buying a distressed Fowler home to renovate and resell within 12 months, hard money funds the purchase and rehab.
Many investors use both strategically. They buy with hard money, complete renovations, then refinance into a DSCR loan if they decide to rent instead of sell.
No, DSCR requires rent-ready properties with active or projected lease income. Hard money funds renovations, then you refinance to DSCR once repairs finish.
DSCR loans cost less at 6-8% versus hard money's 9-14%. But hard money's higher cost only applies for months, while DSCR rates apply for years.
Neither requires personal tax returns. DSCR qualifies on rental income, hard money qualifies on property value and exit strategy.
Yes, most hard money lenders approve borrowers with scores below 600. They focus on the property's value and your renovation plan, not your credit history.
DSCR loans require 20-25% down. Hard money varies from 10-30% depending on the property condition and your experience level.
Yes, this is common. You buy and renovate with hard money, then refinance to DSCR once the property is rent-ready and stabilized.