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in West Hollywood, CA
West Hollywood investors face a choice: long-term rental income or fast fix-and-flip capital. DSCR loans qualify you based on rent rolls, not tax returns. Hard money loans close in days but cost more upfront.
Most West Hollywood multifamily buyers use DSCR. Flip crews working single-family conversions lean hard money. The loan you pick shapes your timeline, budget, and exit strategy from day one.
DSCR loans work when your property generates enough rent to cover the mortgage. Lenders divide monthly rent by monthly payment—typically need 1.0 or higher. No tax returns, no job letters, just lease agreements and rent comps.
Rates run 1-2% above conventional but you get 30-year terms. Close in 3-4 weeks with 20-25% down. Best for buy-and-hold investors planning to keep the property long-term and cash flow from rentals.
Hard money loans fund based on property value, not borrower finances. Lenders care about equity and exit strategy—flip timeline, renovation budget, after-repair value. Credit matters less than the deal itself.
Expect 8-12% rates plus 2-4 points upfront. Terms run 6-24 months, not decades. You close in 7-14 days with as little as 10% down. Built for speed and asset value, not monthly cash flow or long holds.
DSCR loans cost less but move slower. You pay conventional-adjacent rates for 30 years but wait a month to close. Hard money costs double or triple in interest but funds in a week—critical when competing for distressed West Hollywood properties.
DSCR underwriting focuses on rent. Hard money underwriting focuses on asset value and your track record. DSCR works for stabilized rentals already generating income. Hard money works for vacant properties, major rehabs, or time-sensitive acquisitions where speed beats cost.
Use DSCR when you're buying a stabilized rental with tenants in place. West Hollywood duplexes, triplexes, small apartment buildings—if it already cash flows and you plan to hold 5+ years, DSCR saves you thousands in interest over the loan term.
Use hard money when the calendar matters more than the rate. Distressed sales, off-market deals, properties needing gut rehabs before they qualify for traditional financing—these scenarios demand speed. You refinance into DSCR or conventional once renovations finish and rent stabilizes.
Yes, most investors do. Close fast with hard money, finish renovations, lease the property, then refinance into lower-rate DSCR within 12-18 months.
Some lenders allow it but verify rental income carefully. West Hollywood has strict STR regulations that affect projected cash flow and DSCR ratios.
Both do. DSCR handles 2-8 units with existing leases. Hard money funds multi-unit value-add deals if you show clear renovation budgets and exit plans.
Hard money runs 8-12% plus 2-4 points. DSCR runs 7-9% with standard closing costs. On a $1M loan, hard money costs $20-40K more upfront.
Yes, if it already has tenants and verifiable rental income. Lenders need 12-24 months of lease history or comparable market rents to calculate DSCR.