Rental property funding

A Single Asset DSCR (Debt Service Coverage Ratio) Rental Loan is designed for real estate investors looking to finance a rental property. These loans are based on the income the property generates rather than the borrower’s personal income. The DSCR measures the property’s ability to cover its debt payments with rental income, making it ideal for investors seeking to purchase or refinance rental properties.

Key Features of a Single Asset DSCR Rental Loan: 

Property-Based Financing: Approval is based on the property’s rental income and its ability to cover the debt, not the borrower’s personal income or credit score. 

Long-Term: These loans are generally for the long term, often 30 years, providing stable financing for rental properties. 

Flexible Terms: DSCR loans offer flexible terms and can be used for purchasing, refinancing, or cash-out refinancing of rental properties.

Typical Loan Terms for DSCR Rental Loans: Loan Amount: 

Typically up to 80% of the property’s value. Interest Rate: Generally ranges from 5% to 9%, depending on the specifics of the loan and the investor’s profile. 

Loan-to-Value (LTV): Loans often provide up to 80% LTV for the purchase price or appraised value. 

Term: Generally 30 years, with options for interest-only periods. 

Points: May come with 1-3 points (1-3% of the loan amount) paid at closing. 

Origination Fee: Typically 1-2% of the loan amount for processing the loan.

These loans are ideal for investors seeking long-term financing for rental properties without the need for personal income verification.