Question 1

Can I use DSCR for a primary residence in Foster City?

Accepted Answer

No. DSCR loans are for investment properties only. If you're buying a primary home, you need conventional, FHA, or a portfolio product.

Question 2

How much rental income do I need for DSCR approval?

Accepted Answer

Rent must cover 100% to 125% of the mortgage payment depending on the lender. We use market rents or a lease agreement to document income.

Question 3

Why are DSCR rates higher than conventional?

Accepted Answer

Lenders price the lack of income verification as added risk. You're paying 1-2% more for the flexibility to skip tax returns and DTI calculations.

Question 4

Can I switch from conventional to DSCR later?

Accepted Answer

Yes. Many investors refinance into DSCR once they own multiple properties and conventional DTI caps become a limit. We run both to see which fits.

Question 5

Do both loans require 20% down for Foster City rentals?

Accepted Answer

Yes. Conventional needs 20% for investment properties. DSCR typically requires 20-25% depending on credit score and property condition.

Conventional Loans vs DSCR Loans in Foster City: Which Fits Your Strategy?