Real-Estate Loans
DSCR (Debt Service Coverage Ratio) loans are a type of financing designed for real estate investors, particularly those purchasing or refinancing rental properties. The key advantage of DSCR loans is that they focus on the property’s income-producing ability rather than the borrower’s personal income.
Program Highlights
- Qualification Based on Potential Property Cash Flow
- Minimum 660 Credit Score
- No Personal Income or Employment Verification
- Up to 85% LTV
- 30 or 40-Year Fixed Rate, Interest-Only Option
- Loans Up to $3 Million
- No Property Limit
- Purchase, Cash-Out, or Refinance
- Properties can be owned in an LLC
- Non-Warrantable Condos Allowed
- Short-Term Rentals Allowed
Short-Term Rental Property
DSCR loans can be used to purchase short-term rental properties (like those listed on platforms such as Airbnb). The loan is based on the rental income the property is expected to generate, rather than the borrower’s salary or traditional credit score.
Long-Term Rental Property
Investors can also use DSCR loans to acquire long-term rental properties. The rental income from tenants must cover the mortgage payment, taxes, insurance, and other property expenses, making it easier to secure financing for cash-flow-positive properties.
Cash-Out/Refinance Investment Property
With a DSCR cash-out refinance, property investors can refinance an existing investment property to access equity and use it for other investments. The loan approval is based on the property's ability to generate rental income, providing flexibility for investors looking to unlock capital.