15% Down DSCR Loan Specifically for STR

Mortgage Brokers & Lenders
4yFollow

15% Down DSCR Loan Specifically for STR

Anthony Spencer
Rental Property Investor · Carnation, WA · Member since 2021 · 10 posts · 9 votes

Can anyone recommend or underwrite a 15% down DSCR loan based off short term rental income? I'm looking for a 30 yr Am, and someone that can close fast enough to be competitive in a hot market. No prepayment penalty would be a huge bonus as well. Still narrowing down a market, but TN, NC, GA, TX.

I've got access to a 20% down dscr, but looking to increase my buying power to 800K-1M purchase price. 

7Reply
205 views

Most Popular Reply

Jay S.Pro Member
Lender · San Francisco Bay Area · Member since 2019 · 52 posts · 46 votes
4y

Hi Anthony, will DM you and give details. We have few lenders which can make exception and provide 15% down on DSCR loan.

[email protected]408-832-8200
5Reply
See this reply in the discussion

46 Replies

Jump to latestLatest
  • Eric GoldmanBusiness Member
    Lender · PA · Member since 2019 · 359 posts · 192 votes
    4y

    most dscr loans need 20% down for a 30 year fixed term

    484-574-4878
    G2loans- Investor and Commercial Mortgages531 Reviews
    WebsiteView Page
    2Reply
  • Elyse Simpson
    Lender · Joliet, IL · Member since 2021 · 33 posts · 7 votes
    4y

    Hi, Anthony!
    In my experience, 20% is needed for 30 year DSCR loans. If you're set on the 15% down, a bridge loan would be your better bet. The interest is higher, but you could always refi into a 30 year.

    1Reply
  • Jay S.Pro Member
    Lender · San Francisco Bay Area · Member since 2019 · 52 posts · 46 votes
    4y

    Hi Anthony, will DM you and give details. We have few lenders which can make exception and provide 15% down on DSCR loan.

    [email protected]408-832-8200
    5Reply
  • Tony Spencer
    Carnation WA · Member since 2021 · 27 posts · 12 votes
    4y
    0Reply
  • Tony Spencer
    Carnation WA · Member since 2021 · 27 posts · 12 votes
    4y

    0Reply
  • Tony Spencer
    Carnation WA · Member since 2021 · 27 posts · 12 votes
    4y

    So how would it work to use a bridge loan to buy an STR? Do they not consider DTI? You'd need to hold that loan for 2 years until you could use the income from the property to refy, correct?

    Could you elaborate on how that would work logistically?

    1Reply
  • Travis Juntti
    Real Estate Agent · Howell, MI · Member since 2016 · 25 posts · 1 vote
    4y

    @Jay S. Who's your lenders that can provide 15% down on DSCR loan? I know the Mortgage Shop is one.

    0Reply
  • Tony Spencer
    Carnation WA · Member since 2021 · 27 posts · 12 votes
    4y
    Quote from @Tony Spencer:

     The mortgage shop has stopped offering 15% for the time being. Just spoke with them. 

    1Reply
  • Sebastian Hauer
    Rental Property Investor · Mt Pleasant, SC · Member since 2017 · 13 posts · 8 votes
    4y

    @Jay S. I'm also interested in lenders that can do 85% LTV DSCR loans.

    3Reply
  • Brandon LaGrange
    Member since 2019 · 4 posts · 2 votes
    4y
    Interested too
    1Reply
  • Melissa Claypool
    Member since 2020 · 5 posts · 4 votes
    4y

    I am currently checking in with FP - Finance Properties, they say they can do 15%.  Rates will be 6% to 7%.  For 20% down it will be upper 5% to 6%.  They also look for 6 months of reserves (can use 401k... so on). Will let you know how it goes  

    2Reply
  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    4y

    DSCR loan the problem is proving what dollar amount it will cash flow. In purchasing you have little to use, as a refinance you provide the AIrbnb/Verbo statements for 12 or 24 months and they are averaged and given a haircut. Debt service ratio lenders rely on the appraiser to say what market rents are and I don't know one who will estimate on STR. With a $800000 sales price and no HOA you need to clear greater than $5286 monthly. Needs to rent for $180 a night 100% occupied. Smokey Mountains TN probably not, NC the state is talking about striking them down; Galveston beach house maybe if on the water

    2Reply
  • Tony Spencer
    Carnation WA · Member since 2021 · 27 posts · 12 votes
    4y
    Quote from @Caroline Gerardo:

    DSCR loan the problem is proving what dollar amount it will cash flow. In purchasing you have little to use, as a refinance you provide the AIrbnb/Verbo statements for 12 or 24 months and they are averaged and given a haircut. Debt service ratio lenders rely on the appraiser to say what market rents are and I don't know one who will estimate on STR. With a $800000 sales price and no HOA you need to clear greater than $5286 monthly. Needs to rent for $180 a night 100% occupied. Smokey Mountains TN probably not, NC the state is talking about striking them down; Galveston beach house maybe if on the water


    My understanding is theyre pretty common place in the more established STR markets. I hear the Short-term Shop discussing them regularly. I have spoken to their lender, and theyre doing them with 20% down for sure. 15% down is possible coming back.

    0Reply
  • Brandon LaGrange
    Member since 2019 · 4 posts · 2 votes
    4y

    I talked to them today and 15% is available up to max jumbo. 

    1Reply
  • Jay HurstBusiness Member
    Lender · Dallas, TX · Member since 2017 · 1k+ posts · 1k+ votes
    4y

    15% down on a DSCR purchase is available.

    Hurst Real Estate, INC4.991 Reviews
    WebsiteView Page
    0Reply
  • Doug Wade
    Rental Property Investor · Cumberland, MD · Member since 2014 · 47 posts · 15 votes
    4y

    Does The Mortgage Shop have a website ot just their Facebook page??

    0Reply
  • Lynne Burke
    Member since 2021 · 21 posts · 11 votes
    4y

    @Jay Hurst if you don’t mind sharing, who does 15%?

    @Brandon LaGrange who is them that is offering 15%? 

    1Reply
  • Jay HurstBusiness Member
    Lender · Dallas, TX · Member since 2017 · 1k+ posts · 1k+ votes
    4y

      We do them. 

    Hurst Real Estate, INC4.991 Reviews
    WebsiteView Page
    1Reply
  • Brandon LaGrange
    Member since 2019 · 4 posts · 2 votes
    4y
    0Reply
  • Brandon LaGrange
    Member since 2019 · 4 posts · 2 votes
    4y
    Quote from @Caroline Gerardo:

    DSCR loan the problem is proving what dollar amount it will cash flow. In purchasing you have little to use, as a refinance you provide the AIrbnb/Verbo statements for 12 or 24 months and they are averaged and given a haircut. Debt service ratio lenders rely on the appraiser to say what market rents are and I don't know one who will estimate on STR. With a $800000 sales price and no HOA you need to clear greater than $5286 monthly. Needs to rent for $180 a night 100% occupied. Smokey Mountains TN probably not, NC the state is talking about striking them down; Galveston beach house maybe if on the water

    You mean DSCR loans?
    0Reply
  • Stephanie P.Pro Member
    Washington, DC Mortgage Lender/Broker · Member since 2016 · 4k+ posts · 2k+ votes
    4y
    Quote from @Jay Hurst:

      We do them. 


    DSCR only or with bank statements?

    0Reply
  • Tony Spencer
    Carnation WA · Member since 2021 · 27 posts · 12 votes
    4y

    Can anyone do a DSCR in New York State? 15-20% down?

    1Reply
  • Carrie Matuga
    Lender · Riverside, CA · Member since 2017 · 248 posts · 98 votes
    4y

    @Jay Hurst is the debt service ratio based on short term rates or long term rentals?

    0Reply
  • Simmy AhluwaliaPro Member
    Lender · Atlanta, GA · Member since 2015 · 1k+ posts · 200 votes
    4y

    We offer 85% LTV, BUT, there must be a T-12 on the property showing historical rental data. Plus 730 FICO.

    0Reply
  • Eric GoldmanBusiness Member
    Lender · PA · Member since 2019 · 359 posts · 192 votes
    4y

    for a real no tax return, no global underwrite DSCR mortgage 80% LTV is the standard.

    484-574-4878
    G2loans- Investor and Commercial Mortgages531 Reviews
    WebsiteView Page
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free