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in Lompoc, CA
Lompoc's rental market draws two types of investor financing—each built for different timelines. DSCR loans fund long-term rental holds with no income verification. Hard money closes fix-and-flip deals in days, not weeks.
Both skip traditional W-2 underwriting, but the similarities end there. Your project timeline and exit strategy determine which product makes sense.
DSCR loans qualify you on rental income alone. If the property generates enough cash flow to cover the mortgage payment, you're approved. No tax returns, no pay stubs, no employment verification.
You'll get 30-year fixed or ARM terms at rates typically 1-2 points above conventional. LTVs reach 80% on single-family rentals. Rates vary by borrower profile and market conditions, but expect to close in 3-4 weeks.
Hard money lenders fund based on the property's after-repair value, not your financials. They'll lend on distressed Lompoc properties that banks won't touch. Close in 5-10 days when you need to move fast on a deal.
Expect 8-12% rates and 2-4 points upfront. Terms run 6-24 months—this is bridge financing, not permanent debt. Most lenders cap LTV at 65-75% of ARV and require a clear exit strategy before funding.
Timeline separates these products. DSCR loans need 3-4 weeks and require the property to cash flow from day one. Hard money closes in days but costs 3-4 times more in interest and fees.
DSCR works when you're buying a turnkey rental in decent condition. Hard money works when the property needs work or you're competing against cash buyers. As of February 2026, some lenders are expanding non-QM products to include alternative assets for reserves.
Choose DSCR if you're buying a rental that's already rent-ready and you plan to hold long-term. The lower rate and permanent financing justify the longer close. You'll need the property to generate 1.0-1.25x the mortgage payment in rent.
Go hard money when speed matters more than cost—foreclosure auctions, estate sales, or properties needing major rehab. You'll refinance into permanent debt or sell within 12-18 months, so the high rate is temporary.
No. DSCR loans require stabilized rental income at closing. Use hard money for rehabs, then refinance to DSCR once the property is rent-ready.
DSCR loans run 1-2 points above conventional rates. Hard money costs 8-12% plus origination points—significantly higher but for much shorter terms.
Neither requires personal tax returns or W-2s. DSCR underwrites to property income. Hard money underwrites to asset value and equity position.
DSCR loans go up to 80% LTV on single-family rentals. Hard money typically caps at 65-75% of after-repair value, depending on the project.
Yes, this is a common exit strategy. Once renovations finish and you place tenants, refinance into a DSCR loan for permanent financing.