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in Visalia, CA
Visalia investors have two main non-QM paths when traditional loans don't work. DSCR loans qualify based on rental income and work for long-term holds. Hard money loans fund fast based on property value and fit fix-and-flip deals.
Both skip W-2 income verification, but they serve different strategies. DSCR loans offer 30-year terms at lower rates for buy-and-hold investors. Hard money gives you speed and flexibility for short-term projects with quick exits.
DSCR loans qualify you based on whether the property's rent covers the mortgage payment. Lenders want a ratio above 1.0, meaning rent exceeds the total housing payment. You don't need W-2s, paystubs, or personal income documentation.
These loans work for single-family rentals, multi-units, and long-term holds across Visalia. Rates run 1-2% higher than conventional loans, but you get 30-year fixed terms. Most lenders require 20-25% down and credit scores above 620.
Hard money loans fund based on the property's after-repair value, not your financial profile. Lenders care about the deal's equity cushion and your exit strategy. Approval takes days, not weeks, because underwriting focuses on the asset.
These loans fit fix-and-flip projects, distressed properties, and bridge financing in Visalia. Rates typically run 8-12% with 2-4 points upfront. Terms last 6-24 months since these aren't meant for permanent financing. Most lenders fund up to 70% of after-repair value.
Cost structure separates these loans dramatically. DSCR rates run 7-9% with standard closing costs. Hard money hits 8-12% plus hefty points upfront. Hard money costs more per month, but you're only paying for months, not years.
Timeline and property condition matter too. DSCR loans need rent-ready properties and close in 3-4 weeks. Hard money funds distressed properties in under 10 days. DSCR requires appraisals and rent comps. Hard money just needs a property walkthrough and ARV estimate.
Choose DSCR if you're buying a rental property you plan to hold. It works for turnkey homes, established rentals, and properties already generating income. The 30-year term keeps payments manageable while you collect rent and build equity in Visalia's market.
Pick hard money for flips, major renovations, or time-sensitive deals. Use it when you need to close fast or the property needs work before it qualifies for permanent financing. Plan your exit before you borrow since these loans aren't designed for long holds.
Yes, this is a common strategy. Fix up the property with hard money, stabilize rental income, then refinance into a DSCR loan for permanent financing.
DSCR loans typically require prior rental experience. Hard money lenders focus on the deal, not your experience, making them more accessible to new investors.
DSCR loans need rent-ready properties in good condition. Hard money accepts distressed properties since the loan is based on after-repair value.
Yes. Many investors use hard money to acquire and renovate, then cash-out refinance into DSCR loans for long-term rental holds.
Hard money closes in 5-10 days. DSCR loans take 3-4 weeks due to appraisals and rent analysis requirements.