This is a type of loan provided by a lender specifically for purchase or refinance on an investment property with one to four units.\u00a0<\/b><\/p>

The borrower qualifies for this loan based on the cash flow generated by the property itself per year rather than qualifying traditionally using personal income and debts. In a DSCR loan, the standard qualifying DSCR required is 1.25%.\u00a0<\/b><\/p>

The best part DSCR loan is that the borrower does not need to submit any tax returns, pay stubs, or W2s.\u00a0<\/b><\/p>

As long as the cash flow on the property is 1.25% or greater, the lender should be able to get your property qualified for a DSCR loan by providing the current lease agreement.\u00a0<\/b><\/p>

Apart from the cash flow of the property, the owner should have one year of landlord experience. If this is your first time buying a rental property, you can hire a property management company to manage the rental property.<\/b><\/p>

The lenders providing this type of loan would also want to take a look at the total number of investment properties owned by the borrower to analyze the total aggregate cash flow that the borrower gets from all his rental properties as part of reserves.\u00a0<\/b><\/p>

In a DSCR loan, the minimum down payment required is 20% compared to a conventional investment mortgage<\/u><\/a> where the minimum down payment is 25%.<\/b><\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t