This makes getting a DSCR loan more difficult because of the under market rents. 

Hi everybody,My husband is military and we currently own our home in Knoxville (purchased for $450k, we owe about $300,000 with 2.6% interest on 15 year loan).

I'm thinking 30 year amortization with 5-10 year loan with balloon at end of term at 5% interest. 

And by selling the shovel ready lot, I don't need to pony up big sums of cash or take out large construction cost loans.

I am very confused about whether it is best to pay cash (which I would not have to borrow) and then do delayed financing , get a DSCR loan, or something else. 

Hi Denise - If you're eyeing a DSCR loan, maintaining your primary residence is necessary, as most lenders require it.Refinancing could provide quick access to funds by leveraging the equity in your primary property.

Instead, interest is accrued into the loan balance and paid at maturity (when the borrower either sells the property or refinances the loan).

5% down first homeowners loan.

This is really disappointing because I am ready to purchase another property today but will not get approved or have horrible loan terms due to a 640 credit score.Does anyone have any recommendations on how to remediate this issue?

I will layout some information below and I am all ears to advice from there.Current savings: $12,500 (with the capability to pull funds from an IRA if need be)Currently working with a realtor I've worked with before in my rental market who is also an active investorI have the proper steps completed for a DSCR loan from a company found right here at BP and the process was smooth.