DSCR LOANS. Where to get approved?

[Nolan Dalton]

I want to get approved for a DSCR loan. I have walked through a few properties that I know would cash flow. Where can I find a lender? I talked with a manager at my local KeyBank and she told me "There is no such thing as a DSCR loan. That acronym is used as a ratio to determine if a loan would cash flow to qualify."

This would be my 4th property. I am 26 years old and I work in the trades. I am open to all options of lending.

[Mark Munson]

Hi @Nolan Dalton
As others have said, there are plenty of DSCR lenders out there. With a DSCR loan, you should expect up to 80% of the purchase price as the loan amount. As you talk to lenders, make sure you know the following:

1 Rate Lock Policy - If the DSCR lender doesn't rate lock for 45 days, then I'd go elsewhere. Some DSCR lenders will float the rate until the appraisal is back, leaving you open to having the rate changed during the floating period.

2. Ask about Origination Fees - A good, well-capitalized DSCR lender shouldn't be charging more than 2 points, assuming the loan amount isn't too low. If they are telling you 2.5+ in origination fees, you can probably find cheaper money elsewhere.

3. What is the DSCR Requirement - Look for a 1 to 1 ratio, anything higher like 1.2x might force you to put more money down.

If you need more feedback, happy to help. Best of luck!