Question 1

Can I use a DSCR loan for a short-term rental in Santa Cruz County?

Accepted Answer

Yes. Many lenders accept short-term rental income projections. You'll need market rent data from an appraiser to support the DSCR calculation.

Question 2

What credit score do I need for a conventional loan?

Accepted Answer

Most conventional lenders require a 620 minimum. Better rates kick in at 740 and above.

Question 3

Are DSCR loan rates higher than conventional rates?

Accepted Answer

Yes. DSCR is a non-QM product, so lenders price in more risk. Rates vary by borrower profile and market conditions.

Question 4

Do DSCR loans require a down payment?

Accepted Answer

Typically 20–25% down is required. Some lenders go as low as 15% with stronger DSCR ratios.

Question 5

Can I use a conventional loan for an investment property?

Accepted Answer

Yes, but expect higher rates and a larger down payment — usually 15–25%. Investment property pricing is stiffer under conventional guidelines.

Question 6

Which loan is easier to qualify for?

Accepted Answer

Depends on your situation. Investors with heavy write-offs often find DSCR easier. W-2 earners with good credit usually qualify faster with conventional.

Conventional vs DSCR Loans in Scotts Valley, CA