All Forum Posts by: Brittane Jenkins

@Brittane Jenkins, depending on the location, bedroom/bathroom count, and square footage of the home, you can rent each room to maximize rental income. Companies such as HomeRoom and PadSplit will help market and place tenants in your rental. If you're interested in learning more, I'd be happy to connect. 

@Brittane Jenkins Atlanta is a great market for Airbnb but just be aware of the new policies in place limiting what property you can list. It limits you to 2 locations 1 being your primary residence. So if you are looking to scale in Atlanta, I wouldn't say it's probably not the best move. If this is a one-off, do a market search with your property address on https://www.airdna.co/to pull actual data about what you can expect from a listing. Not every property in every block in every city is created equal. Just like any other real estate transaction knowing the numbers and making fact-based choices yields the best results. 

DSCR are strictly going to always need to be business purpose - no owner occupied allowed.

Heres an article with helpful info and definition published on BP:

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

What are DSCR Loans?

While there isn’t an exact, commonly agreed-upon definition out there, here is a handy definition for this specific loan product:

DSCR loans are mortgage loans secured by residential real estate turnkey properties, strictly used for a business purpose and underwritten primarily based on the property.

Important note: DSCR loans refer to the specific loan type, and the "DSCR ratio" (debt service coverage ratio) is a metric used for underwriting and evaluating these loans (and other loans), but the metric and ratio itself are distinct things versus what is referred to as “DSCR loans.”

Some key things to note in the definition:

• DSCR loans are secured loans (meaning that there is collateral that the lender can take if the borrower doesn't pay back the debt). They are also mortgage loans, i.e., secured loans for which the secured collateral is real estate.
• DSCR loans cover residential real estate properties, not commercial real estate properties. So investment properties that are commercial in nature (think office buildings, retail strip centers, etc.) cannot use DSCR loans. They can be leveraged with commercial real estate loans that use the DSCR metric for evaluation; however, these are not under the "DSCR loan" product bucket.
• DSCR loans are for "business purpose," only meaning that the owner of the property can not live in the property under any circumstances. These loans are strictly for investment properties where the property is owned and operated for business purpose and rented out for income. Additionally, for DSCR loans for which the purpose is a “cash-out refinance,” the use of the cash-out proceeds must also be used for a business purpose. Commonly, these proceeds are used for further real estate investment or costs related to the borrower’s real estate business and strictly can‘t be used for personal uses, such as paying off personal credit cards or any nonbusiness expense.
• DSCR loans are "primarily based on the property," meaning that the lender evaluates and qualifies the deal mostly but not completely based on the property’s investment potential. This is a common misconception where people sometimes assume DSCR loans are purely based on the asset. DSCR lenders will run personal credit (which, along with LTV and DSCR, is among the three biggest factors determining your rate and terms) and typically require three to six months of PITIA “reserves” in liquid assets. The rest of the documentation and underwriting will be based on the asset, but it’s important to remember that qualification isn’t 100% based on the property. Your credit and some basic liquid assets matter, too.
• Finally, DSCR loans are for "turnkey" properties only, meaning any property needing any significant renovations or rehab is not going to qualify, and you will likely need to explore hard money options instead.

@Brittane Jenkins, this doesn't exist. A DSCR is an asset-based loan. The borrower would be committing mortgage fraud if they lived in the property. I assume you're asking this because maybe you're 1099/self-employed. If this is the case, work with a mortgage broker.

None that conform to a lender's guidelines. It would be a violation of the loan terms, and inherently NOT a DSCR loan...is the owner-occupant paying themselves rent?