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in Hollister, CA
Hollister investors often need financing that traditional W-2 loans can't provide. DSCR and hard money loans both skip personal income verification, but they solve completely different problems.
DSCR works for cash-flowing rentals you plan to hold long-term. Hard money funds quick flips and rehabs when speed matters more than rate.
The wrong choice costs you thousands in wasted fees or missed opportunities. Here's how to pick the right tool for your San Benito County investment.
DSCR loans qualify you based on rental income, not your tax returns. If the property generates enough rent to cover the mortgage payment by a specific ratio (typically 1.0 or higher), you're approved.
Terms run 30 years with rates currently 2-3 points above conventional. You need 20-25% down and a credit score above 620 in most cases.
These work for Hollister investors building a rental portfolio. Properties on the east side near Dunne Park or downtown can hit the income ratios if rents are strong.
Hard money lenders fund based on the property's after-repair value, not your financials. They approve in days and close in 1-2 weeks when you need to move fast on a deal.
Expect 9-14% rates with 2-4 points in fees. Terms run 6-24 months because these are bridge loans, not permanent financing.
Use hard money for Hollister fixer-uppers you'll renovate and flip or refinance. The speed lets you compete with cash buyers on distressed properties.
Cost separates these loans dramatically. DSCR rates run 7-9% with minimal fees. Hard money hits 9-14% plus several points upfront.
Timeline is the other major split. DSCR takes 3-4 weeks to close. Hard money funds in under two weeks when you're competing on a hot flip.
Use case matters most: DSCR replaces conventional loans for rental investors. Hard money replaces nothing—it's temporary capital until you refinance or sell.
Choose DSCR if you're buying a Hollister rental that's already habitable and cash-flowing. The lower rate saves you money every month you hold the property.
Pick hard money when speed wins the deal or the property needs major rehab. That distressed house on Hillcrest Road won't qualify for DSCR until it's renovated and rented.
Some investors use both: hard money to buy and fix, then refinance into DSCR once it's tenant-ready. That's the cleanest path on fixer-uppers in San Benito County.
No. DSCR requires the property to be rent-ready and generating income. Use hard money for rehab projects, then refinance to DSCR if you decide to hold it.
Hard money closes in 1-2 weeks. DSCR takes 3-4 weeks because lenders verify rental income and order full appraisals.
DSCR typically needs 20-25% down. Hard money varies by deal but often requires 25-35% down based on after-repair value.
Yes, once the property is renovated and rented. Most investors use this strategy to lock in lower permanent financing after the flip.
DSCR rates run 7-9% with minimal fees. Hard money costs 9-14% plus 2-4 points upfront due to short-term risk.