Conventional, DSCR, portfolio and hard money — what each costs in 2026, what you need down, and how to tell which one your deal needs. Dominion Hard Money is a private money brokerage; we place your deal with the lender whose terms fit it.
Most investors start with a conventional investment mortgage because it is the cheapest money available, and most investors eventually stop being able to use one. Knowing which of the four products fits your situation — and roughly when you will outgrow it — saves months of applying for the wrong thing.
| Type | Down / rate | Who it actually suits |
|---|---|---|
| Conventional | 15–25% down ~6.0–7.0% | W-2 income that documents cleanly, fewer than ten financed properties, and time to go through a full underwrite. Cheapest money there is, while you still qualify. |
| DSCR | 20–25% down ~6.25–8.0% | Self-employed, heavy write-offs, or scaling past what conventional will allow. Qualified on the property's rent, no tax returns, and no cap on how many you own. |
| Portfolio | Varies | Lenders holding the loan on their own books rather than selling it. Flexible where agency rules are rigid, priced accordingly. |
| Hard money | 10–30% down 8–15% | Property needs work, or the deal needs closing in days. Short-term only, with an exit planned before you start. |
This is the part nobody warns you about at property one, and it arrives sooner than people expect.
Your tax returns start working against you. By three to five properties, depreciation and expenses commonly leave your Schedule E showing net rental losses even though the portfolio is genuinely profitable. Conventional underwriting reads the adjusted gross income on the return, not the rent roll, and declines you. The better your accountant is, the faster this happens.
Debt-to-income turns against you too. Even inside the property limit, conventional underwriting layers each financed property's payment into your DTI calculation. By property five or six, investors are routinely declined on DTI grounds while the rents plainly cover the loans.
And then there is a hard stop. Fannie Mae caps you at ten financed properties. It is a rule rather than a preference — you cannot finance an eleventh conventionally with perfect credit and a seven-figure income.
The usual path is to start conventional, scale to three or five properties, hit one of those three walls, and move to DSCR — which qualifies on the property's rent instead of your return, and does not count how many you already own. Knowing that in advance means you can plan the transition rather than discover it mid-contract.
More than for a home you would live in, and the difference between the minimum and the sensible number is larger than most people realise.
| Loan | Single family | 2–4 unit |
|---|---|---|
| Conventional | 15% minimum 25% for best pricing | 25% |
| DSCR | 20–25% | 25% |
| Hard money | 10–30%, deal dependent | Deal dependent |
Reserves matter as much as the deposit and get overlooked more often. Lenders commonly want three to twelve months of payments held in cash, and a file with a strong ratio but no reserves stalls in underwriting while a marginal one with a cushion closes.
The most common way investors fund a deposit without draining savings is to borrow against a property they already own — a cash-out refinance or a HELOC on a primary residence or an existing rental.
There is a specific advantage to this beyond convenience: borrowed equity counts as your own funds for investment property purposes, where a gift from a relative generally does not. It is how a great many portfolios get past the second or third property.
The caution is real, though. That HELOC or refinance adds to your debt-to-income, so it brings the conventional wall closer even as it funds the next purchase. If the plan is to keep buying, it is worth mapping which properties you will still be able to finance conventionally afterwards — before you draw on the equity rather than after.
Investment property rates run roughly half a point to a full point above what the same borrower would pay on a home they live in. Within that, five things move your number.
Dominion Hard Money is a private money brokerage. We do not lend our own capital — we place your deal with the lender whose terms actually fit it, which matters most in exactly the situations conventional financing handles worst.
Through our lending partners: DSCR rental financing from 5.99% with no minimum credit score, $75,000 to $2 million, up to 80% LTV, cross-collateral allowed across two or more properties. Fix-and-flip and bridge from 10.99% plus 1.99 points, up to 100% of cost and 70% of value, from $50,000, minimum score 600. Construction from 8.5%, $100,000 to $3 million, 12 to 24 months, credit 650, up to 85% of after-repair value, on non-owner-occupied single family.
All business purpose, non-owner-occupied, written to an entity. Tell us the numbers and you will get a straight answer on whether it is fundable, on what terms, and how fast — before you spend anything.
Conventional starts at 15% for a single-family rental, though 25% gets materially better pricing and removes mortgage insurance. Two-to-four unit properties generally require 25%. DSCR loans run 20% to 25%.
Conventional investment financing starts around 620, but pricing is significantly worse below 680 and the best terms go to 720 and above. DSCR minimums commonly sit at 620 to 660. Hard money is 600 or, with some lenders, no minimum at all.
Conventional underwriting reads net rental income from your Schedule E. Depreciation and expenses often leave that showing a loss even when the portfolio is profitable, so the return says you cannot afford a loan the rents comfortably cover.
Fannie Mae caps you at ten financed properties. It is a hard rule. Past that you need DSCR, portfolio or private financing regardless of your credit or income.
Yes, and it is one of the most common ways investors fund deposits. Borrowed equity counts as your own funds where a gift usually does not. Bear in mind it adds to your debt-to-income and brings the conventional limit closer.
Yes, typically by about half a point to a full point, and more on non-agency products. Lenders price the higher default risk on a property nobody lives in.
Commonly three to twelve months of payments held in cash after closing. A file with reserves and a marginal ratio often closes where a strong ratio with no cushion does not.
If you have documented W-2 income, fewer than ten financed properties and time for a full underwrite, conventional is cheaper and worth the paperwork. If you are self-employed, writing off heavily, buying through an entity, or scaling past the caps, DSCR is usually what keeps you moving.
Answer these and we will tell you whether it is fundable, on what terms, and how fast it could close. Investment property only — we do not lend on a home you will live in.
We will run the numbers and come back to you. If it is time-sensitive, call 903-636-7511.
Dominion Hard Money arranges private and asset-based real estate financing for business purposes only. Not a commitment to lend. All loans subject to underwriting, property review, and approval. Terms vary by property, borrower experience, and exit strategy.