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in Ripon, CA
Ripon investors face a clear fork: long-term rental financing or fast rehab capital. DSCR loans fund properties that generate monthly rent. Hard money funds projects that need quick closes and renovation work.
Both skip W-2 income verification, but they serve different strategies. DSCR loans work for stabilized rentals with tenants already in place. Hard money works for fix-and-flip projects or distressed properties you'll renovate and refinance.
DSCR loans qualify you based on rent, not paystubs. The property's monthly rental income must cover the mortgage payment, usually at a 1.0 to 1.25 ratio. Rates typically run 7.5% to 9.5%, and you'll need 20-25% down.
You get 30-year fixed or adjustable terms, just like conventional loans. These work for investors building portfolios in Ripon's single-family rental market. No tax returns, no employment letters, no debt-to-income calculations.
Hard money loans close in 7-14 days based on property value, not your finances. Lenders fund 65-75% of purchase price or after-repair value. Rates run 9% to 14% with 1-3 points upfront, and terms last 6 to 24 months.
You use these for quick closures on distressed Ripon properties or when traditional financing won't work. The exit strategy matters more than your credit score. Most investors refinance into DSCR or conventional loans once renovations finish.
Timeline separates these products. DSCR loans take 30-45 days to close with full appraisals and title work. Hard money closes in under two weeks with minimal underwriting. DSCR loans cost less per month but require rent-ready properties.
Term length matters just as much. DSCR gives you decades to hold and build equity. Hard money gives you months to execute and exit. DSCR rates are 2-4 points lower, but hard money accepts properties that DSCR lenders reject.
Choose DSCR when you're buying a turnkey rental or a property with tenants already paying rent. It works for Ripon single-family homes generating $2,000+ monthly that you plan to hold for years. Lower rates and long terms make cash flow work.
Choose hard money when speed matters or the property needs work. Foreclosure auctions, off-market deals, and major rehabs all favor hard money. You'll refinance into DSCR or conventional once the property appraises and generates rental income.
Yes, most investors do exactly this. Buy and renovate with hard money, then refinance into DSCR once tenants occupy and the property appraises at higher value.
DSCR costs less over time with lower rates and no balloon payment. Hard money costs more but gives speed and funds properties DSCR lenders won't touch.
DSCR typically requires 20-25% down. Hard money varies widely from 25-35% depending on property condition and your exit strategy.
Yes, but DSCR works better for first-timers buying stabilized rentals. Hard money requires renovation experience or a strong contractor relationship.
Hard money qualifies almost anyone with equity and an exit plan. DSCR requires the property's rent to cover the mortgage payment at 1.0-1.25 ratio.