Investor Debt Service Coverage Loan
Finance your 1-30 unit residential or mixed use property property in most 50 states. Loan options for purchase, refinance or cash out on a 30 year fixed term, Adjustable Rate and Interest only programs available. Debt Service Coverage Ratio (DSCR) is a calculation that helps us determine if a rental investment is generating enough income to make its loan payment obligations. The gross monthly income must cover the subject property *Principal, Interest, Tax, Insurance & Association payment (PITIA). No need to verify personal or business income, No tax returns.
DSCR is calculated by the following simple formula:- DSCR = Monthly Gross Income / Principal, Interest, Tax, Insurance
Required documentation:
- Application, completed by borrower
- 2 months bank statements
- A list of properties you currently own (a REO Schedule)
- No Tax Returns Required
- Lease(s) – (if currently rented) or Appraisal Operating Income Statement
- Sales Contract (on purchase)
- LLC Operating Agreement or Articles of Corporations
- Driver’s License
- Other documents and/or materials may be requested based on the individual borrower’s circumstances and collateral.
Eligible borrowers:
- Citizens / US persons and foreign borrowers permitted, LLCs and Corporations organized in one of the fifty states or the District of Columbia
- Minimum debt service coverage ratio: 0.75% of PITIA
- Minimum credit score: 620
- No foreclosure, bankruptcy, deed in lieu or short sale permitted in the past 24 months.
- If foreclosure, bankruptcy, deed in lieu or short sale between 24 and 48 months, then max 65% LTV and reserves increased by 6 months. Mortgage and Rental History: maximum 1 x 30 x 12 with 0 x 30 in the last 6 months from Note DateAcceptable occupancy:
- Borrowers must sign a business use affidavit)
- 1 unit 85LTV, 2-4 units 80LTV purchase
- 5-30 unit residential 75LTV cash out (720 fico score)
- 2-8 unit mixed use
- Condotels not permitted
- 6 months PITIA for loan amount <$2MM; 12 months PITIA for loan amount ≥ $2MM
- Acceptable states: All 50 states and DC (US Territories not permitted). Wholesale; verify currently licensed states
Other Information:
- 30 year fixed (Interst Only Option available)
- ARM Index - 1-yr LIBOR;
Margins – investor-occupied 5.25%;
Caps – 2% initial, 2% each year and 5% lifetime;
Floor (lifetime minimum rate) - is initial note rate. 3-yr prepayment penalty required for investor occupancy / business purpose loans where permitted by law;
Pre Payment Penalty buyouts may be available.
Loan amounts and loan to value limits:
Investment / Business Purpose / Purchase and Rate & Term, Cash Out Refinance 1-30 units, Condo
