All Forum Posts by: Nicholas Covington

What kind of loan are you looking for? A no-income-based loan or a conventional loan using your personal income?

Here are a few reasons I prefer this product over trying to qualify my clients conventional. 

1. No personal income requirements. We aren’t looking to see if you filed your tax returns and quite frankly you could make $1 a year and still qualify for this loan program. 

2. Reduced documentation requirements. This program is normally advertised as a “no doc” loan but that is simply not true. But since we don’t ask for paystubs, w2s, tax returns, sometimes bank statements… I just say it’s a “lite doc” program

3. No limit on the number you can have! Conventional will cap you at 10 financed properties and frankly if you have over 4 you will need a large amount of money in the bank to qualify. With a DSCR loan you can have as many as your want! You get a loan, and you get a loan, and this home gets a loan too! (Oprah joke)

4. Great product for first-time investors! Though with some limitations, a first-time investor is able to obtain a loan on their first rental property without having to have landlord experience. We are able to use rents right away to qualify for the mortgage with as little as 20% down. 

5. No DTI requirements, though this is kind of the same as no personal income requirements. This program is 99% based on the income of the asset, the property, so your personal debts are not of concern.

What state is this property in? There are definitely options for you.

Hello Samantha, sorry that you have had a negative experience trying to close on a home loan in the states.

Foreign national programs are quite popular but are normally for investment properties. I would assume that since this is an investment website, you are looking to purchase a rental home, but did not want to assume. 

I would say a mortgage broker is likely going to have an easier time getting this to the finish line than a bank.

If you would like some assistance in locating someone to get this done, feel free to reach out.

Quote from @Eric Gaines:

@Jay Voorhees

Hey Jay I have a personal lender that has suggested that but I’m not interested in going that route. I want to establish business credit and i don’t want any of it in my personal name.

Do keep in mind that you will 99.999% be a personal guarantor so likely the loan will still be on your credit. Just depends on if you are dealing with more institutionalized commercial lending or more private commercial. Send me a message if needing some options.

Yes, there are some DSCR loan program options that allow 20% down for 2-4 units.

At the end of the day, occupancy is based on intent. A lender cannot legally bind you to a house and life events occur all the time. Though most will say 1 year, there are plenty of instances where you would be able to qualify for a new primary loan sooner than that under appropriate circumstances. One of the main things you might run into though is being able to use the rental income from the property once you leave, but there are some ways around that as well should you work with a knowledgeable lender. 

Reach out if you would like to chat more.

One of the most important things for an FHA loan of any kind when it comes to a 3 or 4-unit property is the self-sufficientcy test. So if your lender does not know about this then that would be a red flag. If you are needing a 203K then the biggest thing is going to be more so on the contractor side than the lender side, though of course, it is nice if your lender is familiar with the program.

Sounds like you are looking for a DSCR Rental loan that will take the rent from the property to qualify for the loan. Does that sound about right? Very simple loan program, let me know if you need a recommendation.

The best you will likely get is 20% down. I have some sources for you if that is something you can work with.