Question 1

Can I get a DSCR loan on a property that needs repairs?

Accepted Answer

No, DSCR lenders require rent-ready properties that appraise in current condition. Use hard money first, complete repairs, then refinance to DSCR.

Question 2

Which loan type closes faster for investment properties?

Accepted Answer

Hard money closes in 5-10 days typically. DSCR loans take 21-30 days because they require full appraisals and title work like conventional loans.

Question 3

Do both loan types work for first-time real estate investors?

Accepted Answer

DSCR loans accept newer investors with good credit. Hard money lenders prefer experienced investors or charge higher rates for first-timers with unproven exit strategies.

Question 4

What credit score do I need for each loan type?

Accepted Answer

DSCR lenders typically require 660-680 minimum. Hard money lenders care less about credit, some approve with scores in the 500s if equity is strong.

Question 5

Can I use hard money to buy a rental property long-term?

Accepted Answer

Not practically, rates are too high for holds beyond 24 months. Plan to refinance into DSCR or conventional financing once the property stabilizes.

Question 6

Which loan costs more in total fees and interest?

Accepted Answer

Hard money costs more short-term with 9-14% rates plus 2-5 points. DSCR runs 7-9% with lower fees but you pay interest for 30 years.

DSCR vs Hard Money Loans in Rolling Hills: Which Investor Strategy Wins?