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in Gardena, CA
Both DSCR and hard money loans skip W-2 income verification, making them popular with Gardena investors. But they serve completely different strategies and timelines.
DSCR works for buy-and-hold rental plays with solid cash flow. Hard money fits fix-and-flip projects or tight acquisition deadlines when you need fast capital.
DSCR loans qualify you based on the property's rental income, not your tax returns. If the rent covers the mortgage payment by at least 1.0x (sometimes 1.25x), you're likely approved.
These are 30-year fixed mortgages with rates typically 1-2% above conventional. Minimum 20% down, sometimes 25% for weaker ratios or newer investors.
Best for investors buying rental properties in Gardena who want stable financing and plan to hold long-term. No income documentation means privacy and simple underwriting.
Hard money loans are short-term financing secured by the property itself. Lenders care about the asset value and your exit plan, not your credit score or income.
Expect 8-12% rates, 2-4 points upfront, and 6-24 month terms. These loans are expensive but close in days instead of weeks.
Gardena investors use hard money for flips, major rehabs, or time-sensitive purchases at auction. You pay for speed and flexibility, not low rates.
Term length separates these products more than anything. DSCR gives you 30 years to pay it back. Hard money forces refinance or sale within 6-24 months.
Cost structure differs wildly. DSCR has conventional-ish rates and standard closing costs. Hard money hits you with double-digit rates and heavy origination points.
DSCR requires the property to cash flow from day one. Hard money doesn't care about current income since you're fixing and selling anyway.
Choose DSCR if you're buying a turnkey or light-rehab Gardena rental and plan to hold it. You want permanent financing with predictable payments.
Pick hard money when speed matters more than cost. Competitive Gardena deals, auction purchases, or heavy rehabs that won't appraise until work completes.
Some investors use hard money to acquire and renovate, then refinance into DSCR once the property is rent-ready. That's a common two-step strategy.
Not usually. DSCR lenders want stabilized, rent-ready properties with provable cash flow. Heavy rehabs won't appraise or qualify until work is done.
Often 5-10 days if the property appraises clean and title is clear. Speed is the main reason investors pay premium rates.
Yes, typically 6-12 months of mortgage payments in the bank. Hard money usually doesn't require reserves since terms are short.
DSCR. Hard money charges 2-4 points plus higher rates, making it significantly more expensive to close.
Absolutely. That's a standard exit strategy once your Gardena property is renovated and generating rental income.