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in Fort Jones, CA
Fort Jones buyers face a clear split: conventional loans work for owner-occupied properties, while DSCR loans serve real estate investors. The choice hinges on whether you're buying a primary residence or a rental property that generates income.
Conventional loans verify your W-2 income and require you to live in the property. DSCR loans ignore your tax returns entirely and qualify you based on what the property earns in rent.
Conventional loans are Fannie Mae and Freddie Mac mortgages that require documented income and stable employment. You'll need a 620+ credit score and typically 3-20% down depending on whether it's your first home or investment property.
These loans offer the lowest rates in Fort Jones when you occupy the property. Lenders verify income through pay stubs, W-2s, and tax returns. The underwriter reviews your debt-to-income ratio to ensure you can afford the payment.
Rates vary by borrower profile and market conditions. Conventional loans cap at $766,550 in Siskiyou County for single-family homes, which covers most Fort Jones properties comfortably.
DSCR loans qualify you based on rental income divided by the mortgage payment. If the property generates $2,000 in rent and the payment is $1,600, your DSCR ratio is 1.25. Most lenders want 1.0 or higher.
These loans work for self-employed borrowers, investors with multiple properties, or anyone who doesn't want to share tax returns. You'll need 20-25% down and a 660+ credit score in most cases.
DSCR rates run 0.5-1.5% higher than conventional because the lender takes on more risk. But you skip income verification entirely—the property's rent roll is what matters.
Conventional loans require you to live in the property for owner-occupied rates. DSCR loans are investment-only and can't be used for your primary residence. That's the biggest split between these programs.
Income verification separates them completely. Conventional underwriters comb through two years of tax returns and employment history. DSCR lenders pull a rent comparable report and calculate the ratio—they never see your 1040.
Down payments differ too. You can get a conventional loan with 3% down as a first-time buyer. DSCR loans start at 20% down, period. The rate difference reflects that risk: conventional rates beat DSCR by about a point.
Choose conventional if you're buying a home to live in Fort Jones. The rates are better, the down payment is lower, and you get access to the cheapest mortgage money available.
Pick DSCR if you're acquiring rental property and want to avoid income documentation. This works especially well for self-employed borrowers in Siskiyou County who show low taxable income but have cash reserves.
DSCR also makes sense when you're scaling a rental portfolio. Once you own 4-10 financed properties, conventional lenders limit your options. DSCR loans don't count how many mortgages you already have.
No. DSCR loans are strictly for investment properties that you'll rent out. If you want to occupy the property, you need a conventional loan or another owner-occupied program.
Conventional loans typically have lower closing costs. DSCR loans often include higher lender fees and require rent appraisals, which add to upfront expenses.
Most lenders want 6-12 months of reserves per property. Conventional loans may require less, especially for owner-occupied purchases with strong credit.
You can refinance into a DSCR loan once you convert the property to a rental. Just make sure it's been at least 6-12 months since your original purchase.
DSCR loans often close faster since there's no income verification. Conventional loans require full employment and asset documentation, which adds time to underwriting.