Loading
in West Hollywood, CA
West Hollywood's tight rental market and high property values create distinct financing needs. Conventional loans work for owner-occupants and investors with strong W-2 income, while DSCR loans ignore personal earnings entirely.
Your choice hinges on one question: are you buying to live there or purely for rental income? The underwriting approach differs completely between these two paths.
Conventional loans deliver the lowest rates and down payments starting at 3% for primary residences. Lenders verify employment, tax returns, and debt-to-income ratios capped around 50%.
Investment properties require 15-25% down and stricter approval. You'll show two years of tax returns, pay stubs, and prove you can cover both properties if you already own a home.
This works great if you're buying in West Hollywood to live there or have consistent W-2 income that supports the numbers. Rates vary by borrower profile and market conditions.
DSCR loans skip tax returns and pay stubs completely. Approval depends on rental income divided by the mortgage payment — typically need 1.0 or higher to qualify.
West Hollywood's strong rental demand helps hit those ratios. You'll put down 20-25% and accept rates 1-2% higher than conventional, but you're in the game without proving personal income.
These loans fit self-employed investors, 1099 contractors, or anyone building a rental portfolio without traditional income docs. No tax return analysis means your write-offs don't hurt you.
Conventional underwriting centers on you — your job, income, debts, and credit. DSCR underwriting centers on the property's rental potential regardless of what you personally earn.
Rate spreads matter at West Hollywood price points. A 1.5% rate difference on a $1.2M property costs about $1,100 monthly, or $13,200 annually.
Conventional caps how many financed properties you can own, usually four to ten. DSCR loans have no such limit — you can scale indefinitely as long as each property cash flows.
Choose conventional if you're living in the property or have strong W-2 income and want the lowest rate. You'll save thousands yearly on interest with lower down payment options.
Pick DSCR if you're self-employed, building a rental portfolio, or your tax returns don't reflect true income. The higher rate is the cost of not proving personal earnings.
Many West Hollywood investors use both: conventional for the first property while owner-occupied, then DSCR for subsequent rentals as they scale. We structure both paths regularly.
Yes, DSCR works for first-time investors with 20-25% down. You don't need landlord experience if the rent covers the payment at the required ratio.
Conventional typically has slightly lower lender fees. DSCR loans may add appraisal requirements focused on rental comps, but the gap isn't dramatic.
Conventional approves condos easily if the HOA is warrantable. DSCR lenders are pickier about condo projects and often prefer single-family properties.
Yes, once you have tax returns showing the rental income. Many investors start DSCR, then refi conventional after two years to lower the rate.
DSCR often closes quicker since there's no employment or income verification. Conventional takes longer due to tax return and asset review requirements.