Question 1

Can I use a DSCR loan to buy my first rental in Salinas?

Accepted Answer

Yes, DSCR loans work for first-time investors. You need the rental income to cover the mortgage payment at the lender's required ratio.

Question 2

Do DSCR loans require a bigger down payment than conventional?

Accepted Answer

Typically yes. Most DSCR lenders want 20–25% down. Conventional investment property loans often start at 15–20%.

Question 3

Can a self-employed borrower use a conventional loan?

Accepted Answer

Yes, but lenders average your last two years of tax returns. Write-offs that reduce taxable income often hurt conventional qualification.

Question 4

What DSCR ratio do lenders want?

Accepted Answer

Most lenders want a DSCR of 1.0 or higher. That means rent equals or exceeds the monthly mortgage payment. Some lenders allow below 1.0 with compensating factors.

Question 5

Which loan type has better rates in Salinas right now?

Accepted Answer

Conventional rates run lower as of April 2026. DSCR carries a premium for flexible qualification. Rates vary by borrower profile and market conditions.

Question 6

Can I hold a DSCR loan in an LLC?

Accepted Answer

Yes. Most DSCR lenders allow LLC vesting. Conventional loans almost always require the borrower to hold title personally.

Conventional vs DSCR Loans in Salinas, CA