Debt Service Coverage Ratio (DSCR) mortgage loans are a type of commercial real estate loan that is based on the property’s ability to generate enough income to cover the loan payments.
Use Rents to Qualify
DSCR Mortgage Loans
Qualify Using Only Rents
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1-4 Units. 2-8 Units
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60+ Fico
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85% LTV
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30yr, 15yr fixed, IO Option
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DSCR, – Rents to Qualify – .75% Ok
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Loans to $6 Mil+
DSCR Rental Loans
DSCR RENTAL LOANS
DSCR loans offer flexible debt-service coverage ratios, accommodating varying income sources. Primary features are streamlined documentation, competitive rates, and reliable approval processes.
LOAN PROGRAM DETAILS
Typical guidelines for DSCR loans.
Docs
Rental Pmts
Credit Score
620
LTV
85%
Max Loan
$6 Mil
Features of DSCR Loans
- Flexibility in Debt Coverage Ratios
- Diverse Income Source Acceptance
- Streamlined Documentation
- Tailored Repayment Options
- Favorable Loan Terms
Benefits of DSCR Loans
- Improved Borrower Eligibility
- Enhanced Income Assessment
- Simplified Application Process
- Customized Financial Solutions
- Increased Financial Stability
DSCR RENTAL LOAN PROGRAMS
DSCR
Use Rents to Qualify
DSCR - Low Ratio
(Low Ratios to .75)
Access DSCR loans for 1-4 unit & 5-8 unit properties with a .75 ratio, optimizing rental income to meet mortgage requirements. Elevate your investment potential.
BENEFITS
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1-4 Units
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8 Units
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660 Fico
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up to 90% LTV
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30yr, fixed, I/o Option
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Use Rents to Qualify
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Max Loan to $3 Mil
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DSCR to .75%%
DSCR
Use Rents to Qualify
DSCR - NO RATIO
(No Ratio Calculated)
Buy property investment opportunities with DSCR loans for 1-4 unit & 5-8 Units. No strict income ratio requirements. Elevate your real estate portfolio today.
BENEFITS
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1-4 Units
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8 Units
-
660 Fico
-
up to 90% LTV
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30yr, fixed, I/o Option
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Use Rents to Qualify
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Max Loan to $3 Mil
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DSCR to .75%%
DSCR
Use Rents to Qualify
DSCR 2-8 UNITS
(Ratios of 1.0+)
Secure DSCR loans for 2-8 unit properties with a 1.0 ratio, ensuring steady income covers mortgage costs. Elevate your real estate investment strategy now.
BENEFITS
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5-8 Units Res,
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5-8 Unit – Mix Use
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660 Fico
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up to 90% LTV
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30yr, fixed
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Use Rents to Qualify
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Max Loan to $3 Mil
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Min DSCR to 1.0%
Mortgage Calculator
DSCR Loans Residential Mortgage Loans
DSCR (Debt Service Coverage Ratio) loans are a type of loan that is specifically designed for rental properties. These loans are used to determine whether the rental income from the property is enough to cover the loan payments. DSCR loans are typically used by real estate investors or individuals who own rental properties.
Qualifications for a DSCR Loan Residential Mortgage Loan
Qualifying for a DSCR loan residential mortgage loan is different than qualifying for a traditional mortgage. The lender will focus primarily on the property’s rental income and cash flow, rather than the borrower’s personal creditworthiness. Here are some of the qualifications you may need to meet:
- Collateral (the rental property being purchased)
- DSCR ratio of at least 1.25 (meaning the property’s net operating income is 25% greater than its debt service)
- Proof of rental income (the lender will want to see proof of rental income to ensure that the property is generating enough income to cover the loan payments)
- Ability to repay (the lender will want to see that you have a plan to repay the loan)
Documentation Required for a DSCR Loan Residential Mortgage Loan
To apply for a DSCR loan residential mortgage loan, you’ll need to provide several documents to the lender. Here are some of the documents you may need to provide:
- Personal information (name, address, Social Security number, etc.)
- Proof of rental income (rental agreements, lease agreements, etc.)
- Asset documentation (bank statements, investment account statements, retirement account statements)
- Property documentation (purchase agreement, property appraisal)
- Employment documentation (letter from employer, proof of self-employment income)
- Credit history information (credit score, past bankruptcies, foreclosures)
Benefits of DSCR Loans Residential Mortgage Loans
DSCR loans can provide several benefits:
- Loan amount based on property income (the loan amount is determined by the property’s rental income, rather than the borrower’s personal income)
- Lower down payment (DSCR loans may require a lower down payment than traditional mortgages)
- Ability to purchase rental properties (DSCR loans can be used to purchase rental properties)
Apply for a DSCR Loan
If you’re interested in obtaining a DSCR loan residential mortgage loan, We can help. Our team of experienced mortgage professionals can guide you through the process of obtaining a DSCR loan and help you secure the financing you need.
Learn more about DSCR mortgages and discover your options today!
FAQS
What is a DSCR loan?
A DSCR loan, also known as a Debt-Service Coverage Ratio loan, is a type of commercial mortgage loan where the lender evaluates the property’s income-generating potential to determine the borrower’s ability to repay the loan. The DSCR is a key metric used by lenders to assess the property’s cash flow relative to its debt obligations.
How does a DSCR loan differ from traditional commercial loans?
DSCR loans differ from traditional commercial loans in that they primarily focus on the property’s income and cash flow rather than the borrower’s creditworthiness or income. These loans are typically used to finance income-producing properties such as apartment buildings, office complexes, or retail centers.
What is Debt-Service Coverage Ratio (DSCR)?
Debt-Service Coverage Ratio (DSCR) is a financial metric used by lenders to evaluate the ability of a property’s income to cover its debt obligations. It is calculated by dividing the property’s net operating income (NOI) by its total debt service (mortgage payments). A DSCR of 1.0 or higher indicates that the property generates enough income to cover its debt obligations.
What are the benefits of a DSCR loan?
DSCR loans offer several benefits to borrowers, including flexible lending criteria, competitive interest rates, and the ability to finance income-producing properties based on their cash flow rather than the borrower’s creditworthiness or income.
Who is eligible for a DSCR loan?
Eligibility for a DSCR loan is typically based on factors such as the property’s income-generating potential, the Debt-Service Coverage Ratio (DSCR), the property’s occupancy rate, and the borrower’s experience in managing commercial properties.
What types of properties are eligible for DSCR loans?
DSCR loans can be used to finance various types of income-producing properties, including apartment buildings, office complexes, retail centers, industrial properties, and mixed-use developments.
How is the Debt-Service Coverage Ratio (DSCR) calculated?
The Debt-Service Coverage Ratio (DSCR) is calculated by dividing the property’s net operating income (NOI) by its total debt service (mortgage payments). The formula is: DSCR = Net Operating Income (NOI) / Total Debt Service.
How do I apply for a DSCR loan?
To apply for a DSCR loan, borrowers should contact lenders or financial institutions specializing in commercial real estate lending to discuss their borrowing needs and investment goals. They will need to provide documentation of the property’s income and expenses, occupancy rates, and other relevant financial information. The lender will review the application and determine the loan amount and terms for which the borrower qualifies.
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