DSCR Refinance for "Subject to" loan

[Austin Lowe]

I purchased a property subject to two loans. The first one is a FHA mortgage, the second is a HELOC. I have grown a little uneasy with how things are going with the person with whom I am paying the loans for, and I am considering looking for alternatives. For my situation I will not qualify for any conventional financing. The following numbers have been rounded to make math a little easier hopefully:

Loan 1 (FHA) balance: $210,000

Loan 2 (HELOC) balance: $50,000

Property is conservatively worth $360,000

Rent would conservatively bring $2100/month

My question:

Would it be possible to get a DSCR refinance loan to pay off the two existing loans? It is my current primary residence, but I understand that would likely have to change as I cannot rent to myself to my knowledge, although if this is not the case I would like to know. Would I need to season the rent first or would it be possible to just use market data? I'm fine getting creative with things and it's certainly a property I want to have long term. If I can provide more non personal details to help with any answers just ask away. Thanks!

[Austin Lowe]

Quote from @Drago Stanimirovic:

Yes, you can use a DSCR refinance to pay off both the FHA and HELOC loans, even with a "subject to" purchase. You'd need to move out, as DSCR loans are for investment properties only, you can't rent to yourself. The good news is, you don't need a tenant in place; most lenders (like us at Phoenix Funded) can use market rent via a 1007 rent schedule for qualification.

Your numbers look solid with a $260K payoff on a $360K value and $2,100/month in rent, you’re likely to qualify. We’d just need to confirm the rent coverage and ensure clean title.

 Ok awesome! Thanks for the response. For now things are alright, but it's great to know it's an option should something come up. Hopefully I don't need to but I will contact you if it becomes a necessity. Thanks Drago