I've included an example below to help illustrate this.So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.See example below:DSCR < 1Principal + Interest = $1,700Taxes = $350, Insurance = $100, Association Dues = $50Total PITIA = $2200Rent = $2000DSCR = Rent/PITIA = 2000/2200 = 0.91Since the DSCR is 0.91, we know the expenses are greater than the income of the property.DSCR >1Principal + Interest = $1,500Taxes = $250, Insurance = $100, Association Dues = $25Total PITIA = $1875 Rent = $2300DSCR = Rent/PITIA = 2300/1875 = 1.23If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable).

Hey BP, I am getting close to purchasing my first multifamily investment property.

If it did, I would start to question your purchase strategy.  

A friend was renting a place in Denver, and just purchased a home.

All this with only having to put down 3% of the purchase price of the asset!  

Wanted to get some more feedback on either building or purchasing an existing Multi Unit property.

Thanks for all of the information.

Purchase price: $472,500 It is currently operating as a short-term rental.

I'm curious about the following: 1) If you have purchased a property, what are the pros/cons of doing so through your IRA? 

A few lenders may also require the property to be furnished when you purchase the property.