Question 1

Can I use a DSCR loan for my primary residence in Norco?

Accepted Answer

No, DSCR loans are designed exclusively for investment properties that generate rental income. For primary residences, conventional loans or other traditional mortgage programs are required.

Question 2

Which loan type has stricter credit requirements?

Accepted Answer

Conventional loans typically have more standardized credit requirements. DSCR loans may offer more flexibility since they focus on property performance rather than personal credit history alone.

Question 3

Do DSCR loans have higher interest rates than conventional loans?

Accepted Answer

DSCR loans often carry slightly higher rates due to their specialized nature. Rates vary by borrower profile and market conditions for both loan types, so compare specific quotes.

Question 4

How much rental income do I need for a DSCR loan?

Accepted Answer

The property's rental income should typically cover 100% or more of the mortgage payment. A ratio of 1.0 or higher is generally required, though some lenders accept lower ratios.

Question 5

Can I refinance from conventional to DSCR or vice versa?

Accepted Answer

Yes, refinancing between loan types is possible in Norco. Your current property use and financial goals determine which program makes sense for your situation.

Conventional Loans vs DSCR Loans in Norco: Which Mortgage Fits Your Investment Goals?