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in Pomona, CA
Pomona sits at a crossroads for real estate investors. Conventional loans work great if you're W-2 and buying a primary home or small investment portfolio.
DSCR loans flip the script entirely. They qualify you on rental income, not your tax returns. That matters when you're building a portfolio or have complex income.
Conventional loans need clean W-2 income, decent credit, and standard debt ratios. You'll show two years of tax returns and prove you can afford the payment personally.
Rates sit lower than most loan types. You can put down as little as 3% on a primary home, 15% on an investment property. Loan limits go up to $806,500 in LA County for single-family homes.
DSCR loans ignore your personal income. Underwriters look at one number: does the rental income cover the mortgage payment plus expenses? Usually needs 1.0 to 1.25 ratio.
Expect 20-25% down and slightly higher rates than conventional. Credit requirements run similar, but your tax returns don't matter. Perfect for self-employed investors or those maxing out their DTI.
The income question splits these loans entirely. Conventional underwriters calculate your debt-to-income ratio using W-2s and tax returns. DSCR lenders never ask for them.
Down payment requirements favor conventional for primary homes but even out on investments. Rates swing conventional's way by about a point. Property type matters more with DSCR—some lenders won't touch certain areas or conditions.
Choose conventional if you're W-2, buying a primary home, or just starting out in real estate. The rate advantage saves you real money over 30 years. It's the cheapest path when you qualify.
Go DSCR when you're self-employed, building a portfolio beyond 4-10 properties, or your personal DTI is maxed. In Pomona's rental market, finding cash-flowing properties isn't hard. That makes DSCR viable for serious investors who can handle the rate bump.
No. DSCR loans only work for investment properties. If you're buying a primary home, you need conventional, FHA, or another owner-occupied loan type.
They're similar—both typically need 620+ credit. Conventional may flex lower with compensating factors. DSCR lenders care more about property performance than your score.
On investment properties, the gap is small. Conventional needs 15-20% down, DSCR wants 20-25%. Both require skin in the game for rental properties.
Expect 0.5% to 1.5% above conventional rates. The spread varies by lender and property performance. Rates vary by borrower profile and market conditions.
You'd refinance into a DSCR loan. Some investors do this after building equity or when they need to free up personal DTI for more purchases.
DSCR can move quicker—no employment verification or income docs to chase. Conventional timelines depend on how organized your W-2 and tax paperwork is.