Question 1

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

Accepted Answer

No. DSCR loans are investment-property only. Use conventional financing for the home you plan to live in.

Question 2

What credit score do I need for each loan?

Accepted Answer

Conventional typically requires 620 minimum. DSCR lenders usually want 660-680 or higher depending on the program.

Question 3

Which loan has a lower interest rate?

Accepted Answer

Conventional rates are almost always lower. DSCR lenders price in the added risk of investor loans. Rates vary by borrower profile and market conditions.

Question 4

Do DSCR loans require a down payment?

Accepted Answer

Yes. Most DSCR lenders require 20-25% down. Some programs allow less with stronger DSCR ratios.

Question 5

Can a self-employed borrower use a conventional loan in Placer County?

Accepted Answer

Yes, but lenders will use your net income from tax returns — not gross revenue. Two years of returns are standard.

Question 6

What DSCR ratio do lenders want to see?

Accepted Answer

Most lenders want a minimum of 1.0, meaning rent covers the full payment. A ratio of 1.25 or higher gets better terms.

Conventional vs DSCR Loans in Lincoln, CA