Question 1

Can I use a DSCR loan to buy my primary home in Los Gatos?

Accepted Answer

No. DSCR loans are for investment properties only. You need a conventional or government loan for a primary residence.

Question 2

What credit score do I need for a DSCR loan?

Accepted Answer

Most DSCR lenders want at least 660-680. Conventional loans can go as low as 620 with the right lender.

Question 3

Do DSCR loans have higher interest rates than conventional?

Accepted Answer

Yes. DSCR rates run higher because lenders take on more risk. Rates vary by borrower profile and market conditions.

Question 4

How is DSCR calculated on a Los Gatos rental property?

Accepted Answer

Divide the monthly rental income by the full mortgage payment. A result of 1.0 or higher typically satisfies lenders.

Question 5

Can a self-employed buyer use a conventional loan in Los Gatos?

Accepted Answer

Yes, but lenders require two years of tax returns. If write-offs crush your taxable income, DSCR may be a better fit for rentals.

Question 6

Which loan closes faster in Los Gatos?

Accepted Answer

DSCR loans often close faster since there's no income verification process. Conventional timelines depend on documentation complexity.

Conventional vs DSCR Loans in Los Gatos