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in El Monte, CA
El Monte investors face a choice between traditional conventional financing and investor-focused DSCR loans. The right pick depends on whether you're buying a primary residence or rental property.
Conventional loans verify your W-2 income and tax returns. DSCR loans skip that entirely and qualify you based on what the property earns in rent.
Conventional loans work for primary homes, second homes, and investment properties. You qualify based on your job income, tax returns, and credit score.
Rates typically run lower than investor products when you hit 620+ credit and 20% down. Purchase or refinance both work, with loan limits up to $806,500 in Los Angeles County for conforming deals.
Most conventional lenders want two years of W-2s, recent pay stubs, and full tax returns. Self-employed borrowers need solid two-year business documentation with consistent income.
DSCR loans qualify you on rental income alone. The lender calculates the property's monthly rent divided by its monthly debt obligations to determine approval.
No tax returns, no W-2s, no employment verification. You need a DSCR ratio above 1.0 (property earns more than the mortgage costs) to qualify in most cases.
These loans only work for investment properties, never primary residences. Minimum down payments typically hit 20-25% with credit scores around 640 or higher.
The qualification path separates these products. Conventional loans scrutinize your personal finances. DSCR loans care only about rent versus mortgage payment.
Rates differ too. Conventional loans price lower for owner-occupants and strong borrower profiles. DSCR loans charge higher rates because they're non-QM products with more flexible underwriting.
Down payment requirements shift based on use. Conventional allows 3-5% down for primary homes but demands 15-25% for investment properties. DSCR loans require 20-25% minimum across the board.
Choose conventional if you're buying a primary home or have clean W-2 income. The lower rates and smaller down payments make this the default for most El Monte homebuyers.
Pick DSCR if you're buying rental property and your personal income looks messy on paper. Tax write-offs tanked your adjusted gross income? Multiple 1099 streams? DSCR ignores all that.
Many El Monte investors use both. Conventional for their primary residence to lock lower rates. DSCR for rental properties when tax returns don't reflect true income.
No. DSCR loans only work for investment properties. You must use conventional or another loan type for primary residences.
Conventional loans price lower for qualified borrowers. DSCR loans charge higher rates due to flexible underwriting and investor-only focus.
Yes. Conventional allows up to 4 units. DSCR loans also finance multi-unit properties as long as they're rented out.
Conventional loans typically require 620+ credit. DSCR loans often need 640+ but vary by lender and down payment size.
Yes on both. Put down 20% or more and you skip mortgage insurance regardless of which loan you choose.