I put my criteria clearly in the listing: 3x income over rent, 85% on-time payment history on credit report, and good references from past landlord.The biggest mistake you can make is taking the word of a current landlord.

@Lukas Loveland We do monthly payments as well.

For one of my multi-family properties, I chose to dig my toes in the sand and make extra payments on the principal until it was paid off. 

Or, should I just take a fraction of money and put that towards a down payment and finance the rest with a 30 yr mortgage?

I think your biggest concern would be the pre-payment penalty that comes with most DSCR loans.

It enables me to market properties effectively while also managing application screenings, processing monthly payments, and accepting maintenance work orders.

DSCR loans are based off of down payment, credit score and either actual or market rents so it helps to supercharge an investor's real estate goals and net worth.

Beyond that, any excess cash I have will either go into investments or into savings for a down payment on my next property that I can house hack again.

6.125% has P&I of $2625/month.5.75% has a P&I of $2521/monthThis is a $104 benefit.Paying $4400 more towards principle will reduce your payment to $2598, a $27/month savings.Math says buying the rate down has a larger net benefit to you up front, but it will take you 42 months to break even.

Presumably the borrower is unable to refinance at current rates.The borrower may or may not be making payments on the note, even though it is past maturity (is it a problem to foreclose if they are making payments?)