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in Lemon Grove, CA
Conventional loans work best for owner-occupants and investors with strong W-2 income. DSCR loans skip income verification entirely and qualify you based on rental cash flow alone.
Most Lemon Grove buyers use conventional financing for primary homes. Investors with multiple properties or inconsistent personal income lean toward DSCR products.
Conventional loans offer rates from 6-7% with 3-20% down depending on occupancy and credit. You'll need documented income, typically 620+ credit, and a 43% debt-to-income ratio.
These loans close in 30 days with standard appraisals and underwriting. They're ideal for primary residences and investors who can show steady W-2 or 1099 earnings.
DSCR loans require no personal income verification. Lenders approve based on rent-to-payment ratio, typically needing 1.0 or higher coverage for cash-out deals and 0.75 for purchases.
Rates run 1-2% higher than conventional, usually 7-9%. You'll put down 20-25% and need 660+ credit, but tax returns stay out of the equation entirely.
Conventional loans beat DSCR on rate by 1-2 percentage points. A $400k Lemon Grove rental at 6.5% costs $2,528/month versus $2,822 at 8% on DSCR.
DSCR wins on documentation. Self-employed investors or those with multiple properties avoid income calculations altogether. You just need the property to cover its own payment.
Use conventional if you're buying a primary home or have clean W-2 income to document. The rate savings over 30 years matter more than underwriting convenience.
Choose DSCR if you're growing a rental portfolio, self-employed, or your personal income doesn't support more debt. Pay the rate premium to skip documentation headaches and scale faster.
Yes, DSCR works for first-time investors. You'll need 20-25% down and rental income that covers the mortgage payment.
Both close in 30 days typically. DSCR can move slightly faster since there's no income verification or employment checks.
Yes, most DSCR lenders require 6-12 months of reserves per property. Conventional loans need less, around 2-6 months depending on occupancy.
Yes, conventional works for investment properties with 15-25% down. You'll need to document income and count the mortgage against your debt ratio.
Conventional accepts 620+ for most programs. DSCR typically requires 660 minimum, with better rates at 700+.