A DSCR loan only removes the income piece and adds a slightly higher rate and prepayment penalty.

If you have a large mortgage, the penalty can be pricey (eg $50K). 

Prepayment penalties- usually 1-5 year terms.

401K loan is capped at 50K and with withdrawal, you have 10% penalty and tax implications.

Hello everyone! I’m currently working on a project with a property I own in Fort Lauderdale. I’m looking to access some of the equity in the home to buy out my ex-partner, and my goal is to either convert the house in...

I attended a REI conference back in October 2024 prior to knowing anything about Bigger Pockets or investing in general, and it gave me the motivation to seek out information and shoot for my first couple of deals in 2025.

The seller would need to include a clause saying what you CAN'T do, which is what a pre-payment penalty would address. 

Readers should seek professional advice.

What penalties are normal for this type of partnership?

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