Question 1

Can I use a DSCR loan to buy a primary residence?

Accepted Answer

No. DSCR is for investment properties only. For a primary home, you need a conventional or government-backed loan.

Question 2

What credit score do I need for each loan?

Accepted Answer

Conventional typically requires 620 minimum. DSCR lenders often want 680 or higher due to the investor risk profile.

Question 3

Which loan has a lower interest rate?

Accepted Answer

Conventional rates are generally lower. DSCR carries a premium for the non-QM risk. Rates vary by borrower profile and market conditions.

Question 4

Do DSCR lenders check my tax returns?

Accepted Answer

No. That's the point. They qualify the property, not you. No personal income docs means no tax return review.

Question 5

Can I own multiple DSCR loans at once?

Accepted Answer

Yes. DSCR loans are designed for portfolio growth. Many investors hold five or more with no conventional loan limits blocking them.

Question 6

Which loan is better for Watsonville rentals?

Accepted Answer

Depends on your income structure. W-2 investors often start conventional. Self-employed or high-volume investors usually move to DSCR.

Conventional vs DSCR Loans in Watsonville, CA