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in Portola, CA
Portola investors have two main options when personal income won't qualify them for traditional financing. DSCR loans work for cash-flowing rentals, while hard money fits fix-and-flip projects.
Both skip the W-2 verification process that kills most investor deals. The right choice depends on whether you're holding or selling the property within a year.
DSCR loans approve based on monthly rent versus monthly payment. If rent covers the mortgage by 1.0x to 1.25x, you qualify regardless of your tax returns.
These are 30-year loans with rates typically 1-2% above conventional. Portola vacation rentals and long-term properties both work if the numbers hit the DSCR threshold.
Expect 20-25% down and a 620+ credit score minimum. The property must appraise and meet standard occupancy requirements at closing.
Hard money lenders fund based on property value, not income or rent. They look at after-repair value for distressed properties and current value for stabilized ones.
Terms run 6-24 months with rates between 8-12%. These are bridge loans meant for acquisition, renovation, or short-term holds until you refinance or sell.
Credit matters less than equity and exit strategy. Many Portola investors use hard money to grab properties fast, then refinance into DSCR once rents stabilize.
DSCR costs less per month but requires rent verification and appraisals. Hard money closes faster with fewer conditions but charges significantly higher rates.
DSCR needs the property rent-ready at closing. Hard money funds vacant or distressed properties that won't qualify elsewhere until renovations finish.
Exit strategy differs completely. DSCR is your end loan for a rental hold. Hard money is temporary financing until you sell or refinance to conventional or DSCR.
Use DSCR if you're buying a Portola rental to hold long-term and the property already generates or will immediately generate rent. The lower rate saves thousands monthly.
Use hard money when you need fast funding for a fixer, can't wait 30 days, or the property won't appraise in current condition. Plan your refinance exit before you close.
Many investors use both. Hard money to acquire and renovate a distressed Portola cabin, then refinance to DSCR once it's rented and cash-flowing.
Yes, if you can document rental income through lease agreements or booking platforms. The monthly rent must cover 100-125% of the monthly mortgage payment.
Most hard money lenders close in 5-10 days once you have a signed purchase contract. Some can fund in 3 days for simple deals with strong equity.
Either works. Many investors use an LLC for liability protection, but DSCR lenders approve personal name closings without issue.
Most hard money lenders accept 580-600 minimum. Your loan-to-value ratio and exit strategy matter more than credit score for approval.
Absolutely. That's the standard strategy for fix-and-flip-to-rental projects. Finish renovations, place a tenant, then refinance to lower DSCR rate.
DSCR typically fits better since you're holding long-term. Hard money works if you have local contractors and can manage a quick renovation remotely.