I am the dumb partner with bandwidth, so I am out asking novice questions.We purchased a 36 unit property in northern California using a combination of a $4M bridge loan at 7.75% I/O and $2M cash on 12/10/2021.

It's either amortized or i/o.

There are times that I/O can be beneficial to all parties but with mt particular case, the units are turnkey, renting at market value so there is no need for me not to attack principle.If you're a seller, I/O is the way to go but as a buyer, I never want to get into any I/O for more than 1 year, tops.What are your thoughts?

I was able to get it at 7.5% I/O with 20% down and now prepay.

The way I could make this work is a 3 years I/O from the Seller, and make sure I am buying a property with undermarket rents and ability to force additional appreciation.

One on CA and one in MO.both around 5.75% for 5yr or 10 yr, PITI, balloon in 10 or 5.85% for in IO, balloon un 10.

Some competitive long term IO products are also becoming popular to obtain higher leverage when DSCR constraints present themselves like this. 

The difference in terms between a 680 and a 740 is fairly substantial (a higher differential in pricing than if the loan was conventional/FHA/VA/USDA type)- There's customizable options for everything, including rate locks, prepays, front-end/back-end broker compensation, I/O options (and a range of I/O options) etc- Generally speaking, we're looking at seeing immediate access to 6 month liquid reserves (not necessarily escrowed) so that the buyer can cover the property's debt after closing were it not to be leased A real life example: a client of mine thought the DSCR for his property is 1.2 for a cash-out refinance based onDSCR = $1000 (current leased value)/$750 (PITI) = 1.2 ------- (1) Upon closer inspection, found out that the property is in a flood zone which adds $100/month to the expenses.

They are generally 30 Yr Loans (Fixed, IO, ARM, etc.).

Most of the lenders close DSCR loans on either 30 year fixed or have gone to a 40 year I/O so fixed rate typically isn't an issue on these.