Question 1

Can I get a DSCR loan on a property with no rental history?

Accepted Answer

Yes. Lenders use market rents from an appraisal to calculate your DSCR. They don't need actual lease agreements if the property is vacant or newly purchased.

Question 2

What happens if I can't pay off my hard money loan on time?

Accepted Answer

Most hard money lenders offer extensions for a fee, typically 1-2 points. Plan your exit before you borrow. If the project stalls, you risk foreclosure.

Question 3

Do DSCR loans require reserves?

Accepted Answer

Yes. Expect to show 6-12 months of mortgage payments in liquid reserves. Some lenders waive this for strong DSCR ratios above 1.25.

Question 4

Can I use hard money for a property I plan to live in?

Accepted Answer

No. Hard money is for investment properties only. Lenders won't fund owner-occupied deals with these terms. You'd need a different loan type.

Question 5

Which loan type works better for Atherton's price points?

Accepted Answer

DSCR works if rents justify the purchase price. Hard money helps when you need speed or the property needs work before it qualifies for traditional financing.

DSCR Loans vs Hard Money Loans: Which Fits Your Atherton Investment Strategy?