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Millbrae's proximity to SFO and Caltrain makes it a strong rental market for Bay Area commuters and tech workers. DSCR loans let investors qualify based on rental income potential rather than personal tax returns.
This financing approach works well for self-employed investors or those with multiple properties who want to expand their portfolio without traditional income documentation. The property's cash flow determines loan approval.
DSCR Loans in Millbrae
DSCR loans require the property's rental income to cover the mortgage payment by a specific ratio, typically 1.0 or higher. A 1.25 DSCR means rental income exceeds the mortgage payment by 25 percent.
Most lenders require 15-25 percent down payment and credit scores above 640. The property must be an investment property—owner-occupied homes don't qualify for DSCR financing.
You'll need an appraisal with a rental income analysis. No tax returns, W-2s, or employment verification required for approval.
Local decision guide
Use this guide to connect dscr loans eligibility, lender expectations, and local market factors before comparing payment options in Millbrae.
Millbrae's proximity to SFO and Caltrain makes it a strong rental market for Bay Area commuters and tech workers. DSCR loans let investors qualify based on rental income potential rather than personal tax returns.
This financing approach works well for self-employed investors or those with multiple properties who want to expand their portfolio without traditional income documentation. The property's cash flow determines loan approval.
DSCR loans require the property's rental income to cover the mortgage payment by a specific ratio, typically 1.0 or higher. A 1.25 DSCR means rental income exceeds the mortgage payment by 25 percent.
DSCR loans come from non-QM lenders who specialize in investor financing. These aren't available through traditional banks or credit unions in most cases.
Rate pricing depends on DSCR ratio, down payment, credit score, and property type. Stronger ratios and larger down payments earn better pricing. Rates vary by borrower profile and market conditions.
Experienced mortgage brokers maintain relationships with multiple DSCR lenders, allowing them to shop your scenario for the most competitive terms.
Calculate your DSCR before applying by dividing expected monthly rent by your total monthly housing payment. Use conservative rent estimates based on market data, not optimistic projections.
Single-family homes often qualify more easily than condos due to HOA fees affecting the DSCR calculation. Millbrae's condo market is active, but factor association dues into your debt service.
Consider getting pre-qualified with projected rental income before making offers. This prevents surprises during underwriting when the appraisal comes back with different rent estimates than you expected.
Traditional investor loans require full income documentation and debt-to-income calculations that include all your properties. DSCR loans evaluate each property independently based on its own cash flow.
Bank statement loans also avoid tax returns but require 12-24 months of business bank statements. DSCR loans need no income documentation at all—just the property's rental analysis.
Hard money and bridge loans close faster but carry higher rates and shorter terms. DSCR loans offer 30-year fixed options at lower rates for investors who don't need emergency speed.
Millbrae sits in one of California's most expensive counties, where rental demand stays strong year-round. Properties near BART and Caltrain stations command premium rents that support higher DSCR ratios.
San Mateo County has specific rental regulations and inspection requirements. Factor compliance costs into your cash flow projections before assuming rental income levels.
The city's limited housing inventory and proximity to tech employment centers create stable tenant pools. This rental stability helps underwriters approve DSCR loans with confidence in sustained income.
Yes, lenders use the appraisal's fair market rent analysis for vacant properties. The appraiser researches comparable rentals in Millbrae to determine income potential.
Most DSCR lenders don't require previous landlord experience. The property's income coverage matters more than your investment history, though some lenders may have requirements.
Some lenders approve ratios as low as 0.75 with larger down payments. You'll pay higher rates, and the property must still show strong income potential.
Typical timeline runs 30-45 days. The appraisal with rental analysis adds time compared to conventional loans, especially in competitive Bay Area markets.
Yes, DSCR loans work for both purchases and refinances. This helps investors pull equity from performing rentals without income documentation requirements.