Interest only is an option as well, would calculate DSCR on the IO payment

I'm happy because I really like this 40-year DSCR product.  4.25% with 3 points; 75% cash-out; 10-yr IO then 30-year amortization at same 4.25% rate. 

I-O!

If it is a HML the payments are likely IO, but there will still be a payment component. 

As long as you have a plan to pay the I/O payment and eventually principle (and your plan is conservative) then it could certainly work

Now, they are easily 75% of what I broker.ARMs with I/O are highly desired in this market for a few reasons:Increased Cash Flow - The most popular that I broker are 5/1 ARMs with I/O for 5 years, then 25yr Amortization behind it.

We offer 80% cash out, NO personal guarantee, I/O loans with a DSCR minimum of 1.0.Bobby 

I've used the following assumptions, which I think are broadly reasonable, depending on your asset's location/deal profile:5.5% cap rate65% LTV IO financing @ 3.5%Net Operating Income of $203,500This gets you to necessary equity slug of ~$1.3-1.4MM after closing costs to get to $120k/annually of NCF after debt service. 

Our bank for rehabs loans 75% of the purchase price and 80% of the renovation on a 1 year IO over a 25 year payment schedule.

We're going to look at the minimum monthly payment, just like we would for a credit card or car loan.Technically if it's an interest only payment we are supposed to do some math that beats you up a bit more than the minimum payment, but I've never had an underwriter take out the 9 button calculator to do that math and figure out that it's an i/o payment.