Question 1

Can I use a DSCR loan to buy a primary residence in Costa Mesa?

Accepted Answer

No. DSCR loans are investment property only. For a primary residence, you need conventional, FHA, or another owner-occupant program.

Question 2

Do DSCR lenders check my credit score?

Accepted Answer

Yes. Most DSCR lenders require a 620-640 minimum credit score. Higher scores get you better rates and terms.

Question 3

What DSCR ratio do I need to qualify?

Accepted Answer

Most lenders want 1.0 or above — rent covers 100% of the payment. Some allow 0.75 with a larger down payment.

Question 4

Which loan has a lower interest rate?

Accepted Answer

Conventional loans almost always carry lower rates. DSCR loans price higher because they carry more lender risk. Rates vary by borrower profile and market conditions.

Question 5

Can a self-employed investor use a conventional loan for a rental?

Accepted Answer

Yes, but lenders will scrutinize two years of tax returns. If write-offs reduce your taxable income significantly, qualifying becomes difficult.

Question 6

How much do I need down for each loan type?

Accepted Answer

Conventional investment properties require 15-25% down. DSCR loans typically require 20-25% down minimum.

Conventional vs DSCR Loans in Costa Mesa, CA