Question 1

Can I use a DSCR loan to buy a primary residence?

Accepted Answer

No. DSCR loans are investment property only. For a primary home in Mission Viejo, you need conventional or a government-backed loan.

Question 2

What credit score do I need for a DSCR loan?

Accepted Answer

Most DSCR lenders want 680 or higher. Conventional loans can go as low as 620, depending on the lender.

Question 3

Do conventional loans allow rental properties?

Accepted Answer

Yes, up to a point. You can finance a 1-4 unit investment property conventionally, but lenders still verify your personal income.

Question 4

Which loan has a lower interest rate?

Accepted Answer

Conventional almost always wins on rate. DSCR is a non-QM product and carries a rate premium. Rates vary by borrower profile and market conditions.

Question 5

How is DSCR calculated?

Accepted Answer

Divide the monthly rent by the total mortgage payment (PITIA). A ratio of 1.0 breaks even. Most lenders want 1.1 or above.

Question 6

Can a self-employed buyer use a conventional loan in Mission Viejo?

Accepted Answer

Yes, but lenders use your net taxable income from two years of returns. Heavy write-offs often reduce qualifying income significantly.

Conventional vs DSCR Loans in Mission Viejo