Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
×
Take Your Forum Experience
to the Next Level
Create a free account and join over 3 million investors sharing
their journeys and helping each other succeed.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
Already a member?  Login here
Private Lending & Conventional Mortgage Advice
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated about 1 year ago on . Most recent reply

User Stats

22
Posts
13
Votes
Rebecca B.
  • Investor
  • Plano, TX
13
Votes |
22
Posts

Newish Investor - DSCR loan options for a house hack duplex in San Antonio

Rebecca B.
  • Investor
  • Plano, TX
Posted

I'm a newish investor, bought a duplex in San Antonio, TX to house hack last year. Major unexpected repairs meant we only had enough money to fix one unit in 2023, but I anticipate finishing renovations on the second unit by Summer 2024. These are the details:

  • * Approx. ARV: $225,000
  • * Loan balance: $135,000
  • * Current mortgage rate: 7.65% APR
  • * Monthly mortgage (PITI): $1520
  • * Rents :
    • - 1 unit - $1500 (midterm rental)
    • - 1 unit - $800 (long term rental - anticipated rent)
  • *Approx. FICO score: 690-700 (no negative marks but my DTI is kind of high at 30% usage)

The deal is not great, but please be kind. I'm doing my best to make it work. I want to refinance into a DSCR loan when renovation is complete. I've never used this type of loan product before but I'd really like to refinance into a DSCR loan. Are rates low enough for this deal to make sense? What kind of points, closing costs, and rates can I expect? Any resources where I can learn more about this type of loan?

Most Popular Reply

User Stats

4,576
Posts
4,417
Votes
Robin Simon
#3 Private Lending & Conventional Mortgage Advice Contributor
  • Lender
  • Austin, TX
4,417
Votes |
4,576
Posts
Robin Simon
#3 Private Lending & Conventional Mortgage Advice Contributor
  • Lender
  • Austin, TX
Replied

Hi - assuming you are done with the "house hacking" parts (i.e. not living in the property and can document that) - this could certainly work for a DSCR Loan. Rates have come down a bit and can work in certain situations - but this one looks like it potentially has the factors to make DSCR work in this environment (lower on the value range, multi-unit, creative leasing strategies i.e. MTR).

Rates and Fees can vary - probably looking now (but things can change fast by summer) of rates in the 6.5-8.5% range and closing fees anything from 0 points to a heavy buydown (3-4 points) for flexible lenders.

As for resources, check out this 10-part article series on DSCR Loans published here on BP last year, should cover everything you need to know!

DSCR Loans: What Are They And How To Get The Best Terms

https://www.biggerpockets.com/...

DSCR Loans: How To Use Pro Strategies To Save More And Make More

https://www.biggerpockets.com/...

Multifamily DSCR Loans: A New High-Impact Loan Option For Real Estate Investors?

https://www.biggerpockets.com/...

12 Frequently Asked Questions (And Answers) About DSCR Loans

https://www.biggerpockets.com/...

8 More Commonly Asked Questions and Answers to DSCR Loans

https://www.biggerpockets.com/blog/eight-questions-and-answe...

What Documents Do You Need for a DSCR Loan?

https://www.biggerpockets.com/blog/what-documents-do-you-nee...

BRRRR Loans: What Are the Options, and How Do DSCR Loans Stack Up?

https://www.biggerpockets.com/blog/brrrr-loans-what-are-the-...

Short-Term Rental Loans: What Are the Options and How Do DSCR Loans Stack Up?

https://www.biggerpockets.com/blog/short-term-rental-loans-a...

DSCR Loans: Terms to Know When Working With These Popular Rental Loan

https://www.biggerpockets.com/blog/dscr-loans-terms-to-know

What’s Next For DSCR Loans? Updates For 2024 and Beyond

https://www.biggerpockets.com/blog/what-is-coming-in-2024-fo...

  • Robin Simon
  • [email protected]
  • Loading replies...