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in Ukiah, CA
Ukiah buyers face a clear fork: Conventional loans for owner-occupied properties or DSCR loans for rental investments. The decision hinges on whether you're living in the home or generating rental income from it.
Conventional loans qualify you on personal income and credit. DSCR loans skip your W-2 entirely and qualify the property based on rent it can collect versus the mortgage payment.
Conventional loans require 620+ credit and document your income through tax returns or pay stubs. You'll need 3-5% down for a primary residence, 15% for a second home, and 20% for an investment property.
These loans offer the lowest rates in the market when you have strong credit and stable income. Lenders cap your debt-to-income ratio at 50%, meaning your total monthly debts can't exceed half your gross income.
DSCR loans qualify you on one number: the property's rent divided by its total housing payment. Lenders want to see 1.0 or higher, meaning rent covers or exceeds the mortgage, taxes, insurance, and HOA fees.
These loans require 20-25% down and don't care about your job, income, or DTI ratio. You could be retired, self-employed, or between jobs—it doesn't matter if the property cash flows.
Conventional loans beat DSCR on rate by 1-2 percentage points. But conventional lenders scrutinize your tax returns, pay stubs, and debt load—DSCR lenders look only at the property's rent roll or appraisal projection.
Ukiah investors building portfolios hit a wall with conventional loans after 4-10 properties. DSCR loans have no property count limit, making them essential for scaling beyond that threshold.
Buy conventional if you're living in the home or have W-2 income and clean tax returns. The rate savings over 30 years are substantial, and qualification is straightforward with documented income.
Choose DSCR if you're buying a rental property with complex income, already own multiple properties, or want to scale a portfolio without hitting lender property limits. Accept the higher rate as the cost of flexible qualification.
No. DSCR loans are for investment properties only. If you're living in the home, you need a conventional, FHA, or VA loan instead.
Most lenders want 1.0 or higher, meaning rent equals or exceeds the full housing payment. Some allow 0.75 with larger down payments and higher rates.
No. You can finance unlimited properties with DSCR loans, making them essential for investors scaling past 10 properties where conventional financing stops.
Expect DSCR rates 1-2% higher than conventional. Rates vary by borrower profile and market conditions, but the gap reflects the flexible underwriting.
Yes, through a refinance. Once you have two years of tax returns showing the rental income, you can often refinance into conventional for a better rate.