Question 1

What's the minimum down payment for an investor loan in Davis?

Accepted Answer

Most lenders require 20% to 25% down on investor properties. Some portfolio lenders go as low as 15% with strong reserves and credit. The higher down payment protects the lender if rents fall short.

Question 2

Can I count rental income from a property I don't own yet?

Accepted Answer

Yes — if you have a signed lease from a tenant, that income counts toward qualification. Without a lease, lenders rely on market rent comps. Either way, the property must support a 1.2 DSCR or you need documented reserves.

Question 3

Do I need a perfect credit score to qualify for an investor loan?

Accepted Answer

No — 680 FICO is the typical minimum. Lenders care more about payment history and reserves than a pristine score. A 700+ score opens better rates and terms, but 680–700 is workable with strong cash flow or reserves.

Question 4

What happens if the rental income doesn't cover the mortgage payment?

Accepted Answer

That's where reserves matter. Lenders require six to twelve months of PITI in liquid assets to cover shortfalls. No-ratio financing skips the DSCR test entirely but still demands reserves. You must prove you can carry the loan.

Question 5

How long does it take to close an investor loan in Davis?

Accepted Answer

Plan for 30 to 45 days. Investor loans take longer than owner-occupied because lenders verify rental income, run stricter appraisals, and check cash reserves. A broker can speed this up by submitting a clean file upfront.

Investor Loans in Davis: Financing Rental Properties in Yolo County