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in Tiburon, CA
Tiburon investors face a choice: conventional financing backed by W-2 income or DSCR loans that qualify on rental revenue alone. Your employment situation and property type determine which path makes sense.
Conventional loans offer lower rates and better terms for owner-occupants and W-2 earners. DSCR loans work when the property income tells a better story than your tax returns.
Conventional loans are what most Tiburon homebuyers use for primary residences. You'll need documented income, 620+ credit, and down payment ranging from 3% to 20% depending on property type.
These loans carry the lowest rates we see—often 0.5% to 1% below DSCR pricing. Lenders verify your W-2s, tax returns, and debt-to-income ratio stays under 50%.
Investment properties require 15-25% down and face stricter reserve requirements. Rates increase about 0.375% for rentals versus owner-occupied homes.
DSCR loans ignore your personal income completely. We qualify you based on whether the rental income covers the mortgage payment by an acceptable margin—typically 1.0x to 1.25x.
These loans appeal to self-employed Tiburon investors who show minimal income on tax returns or own multiple properties that blow out conventional DTI limits. No tax returns, no W-2s, no employment verification.
Expect 20-25% down and rates running 1-2% above conventional pricing. Lenders look at the rent roll or market rent appraisal, not your 1040. Rates vary by borrower profile and market conditions.
The qualification story differs completely. Conventional lenders want to see stable W-2 income and clean tax returns. DSCR lenders only care if the property generates enough rent to cover its own mortgage.
Rate spreads matter in Tiburon's price range. On a $2M investment property, that extra 1.5% in DSCR pricing costs roughly $2,500 monthly. You're paying for underwriting flexibility.
Conventional loans cap at 10 financed properties. DSCR programs let you finance unlimited rentals since they don't count against personal DTI. That distinction matters for serious portfolio investors.
Use conventional financing if you have W-2 income and this rental won't push your DTI over 50%. The rate savings justify the documentation hassle on properties you'll hold long-term.
DSCR makes sense when you're self-employed with aggressive write-offs, already own 5+ financed rentals, or need faster closing without income verification. You're trading rate for qualification ease.
Many Tiburon investors use both programs strategically. Conventional for their first few rentals, then DSCR once portfolio size or tax strategy makes traditional qualifying impractical.
No. DSCR loans only work for investment properties that generate rental income. Primary residences require conventional or government-backed financing.
Conventional loans start at 620 for investment properties. DSCR lenders typically want 680+ and prefer 700+ for best pricing.
They divide monthly rental income by the proposed mortgage payment. A 1.25 DSCR means rent covers 125% of the payment including taxes and insurance.
DSCR loans often close quicker since there's no income verification. Expect 15-20 days versus 25-30 for conventional with full documentation.
Yes. Many investors refinance to DSCR once their income situation changes or they exceed conventional portfolio limits.