Looking for a DSCR loan provider

[Tel Cyg]

Hi all,

This is my first post! I am a first time home buyer looking to purchase an out of state investment property through a newly formed LLC (I am based in NYC, looking to buy in Ohio). I am specifically looking to rent out to section 8. I have a high credit score, good income, and money in the bank, but I have been having a difficult time finding a DSCR lender I feel like I can trust. I'd really prefer to hear from those that have gone through a similar process as me and get recommendations for lenders to look into? I would love to purchase ASAP but don't want to rush through this process especially since it is my first time. The purchase price should be under 100k (around 80k or so) and I am not looking to put more than 20% down as I'd love to purchase more than one property this year.

Happy to provide any additional information. Please throw any advice / recommendations my way - I'd appreciate it so much! Thanks!

[Doug Smith]

When you say "first time home buyer", I want to clarify that you currently do not own a primary residence...or any property, correct? Dodd Frank was very specific about lenders verifying homeowners' income when they purchase a home. It is true that does not apply to investment property, but what happened was that first time home buyers that did not qualify for a home loan were trying to circumvent that Dodd Frank rule by saying "oh, this is a rental property" (wink wink) and then move into it...basically creating a no-income verification loan. The CFPB doesn't believe that you would buy a rental before you would buy a residence, so they gave pushback on lending to guarantors that don't currently own a property. Most lenders won't do it. I've seen several scenarios where it made sense to rent instead of buying a primary while buying a rental home...such as the Manhattan attorney that rented but wanted to be part of an LLC buying a duplex in FL for rental purposes. That being said, most lenders don't want to tangle with the CFPB and most won't risk it by lending to a guarantor that does not currently own a home. Please clarify if you currently own a property or not...from reading your post it appears that you might not.

[Tel Cyg]

Hey, thanks for the reply! I currently do not own a primary residence nor any other type of property. Being that this property will be out of state (I live in NYC, property will be purchased in Ohio), I am hoping this should alleviate any concerns of me moving into the property haha!

[John Mason]

Does this help?

https://www.biggerpockets.com/forums/49/topics/1093867-dscr-...

There are quite a few here on this form so I am sure you can get someone reputed very easily

[John Mason]

@Tel Cyg https://www.biggerpockets.com/forums/517/topics/1160872-look...

[Tel Cyg]

These are awesome links thank you so much!

[Remington Lyman]

Quote from @Tel Cyg:

Hi all,

This is my first post! I am a first time home buyer looking to purchase an out of state investment property through a newly formed LLC (I am based in NYC, looking to buy in Ohio). I am specifically looking to rent out to section 8. I have a high credit score, good income, and money in the bank, but I have been having a difficult time finding a DSCR lender I feel like I can trust. I'd really prefer to hear from those that have gone through a similar process as me and get recommendations for lenders to look into? I would love to purchase ASAP but don't want to rush through this process especially since it is my first time. The purchase price should be under 100k (around 80k or so) and I am not looking to put more than 20% down as I'd love to purchase more than one property this year.

Happy to provide any additional information. Please throw any advice / recommendations my way - I'd appreciate it so much! Thanks!

 Welcome to BiggerPockets!

[Samuel Diouf]

Hey Tel, I'd be happy to send you referrals for DSCR lenders.

[Anderson S.]

General rule of thumb for hard money is 25% (plus closing costs) down especially if you don't have a lot of experience. We'd be glad to chat through your options.