Rocket mortgage dscr

Investor · Beach park IL · Member since 2022 · 15 posts · 9 votes

Hi how are you doing BP community I have a loan of one of my rental properties with rocket mortgage and they are offering dscr to cash out refi and I wonder if anyone worked before with rocket mortgage they offer $0 out of pocket fee , thanks

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Tyler MccleanPro Member

Investor · Nassau County, NY · Member since 2022 · 69 posts · 19 votes

Hey Jose! I personally have never worked with rocket, but I work with a lot of different banks. Have they discussed rates with you yet? It's strongly advisable to get a second opinion. Could save you a lot of money in the long run. Shoot me a DM I'd be more than happy to run through your scenario.

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Tyler MccleanPro Member
Investor · Nassau County, NY · Member since 2022 · 69 posts · 19 votes
3d
Hey Jose! I personally have never worked with rocket, but I work with a lot of different banks. Have they discussed rates with you yet? It's strongly advisable to get a second opinion. Could save you a lot of money in the long run. Shoot me a DM I'd be more than happy to run through your scenario.
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
3d
When they launched the program I know there were frustrations with getting it approved which is documented here on bp. I have no experience just sharing what others mentioned and you can research here on bp - but over time things can change (for better or worse).
I would check terms etc and see if it makes sense and shop around but if no fees probably gonna be tough to beat
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Tim SwierczekPro Member
Lender · White Bear Township, MN · Member since 2016 · 1k+ posts · 1k+ votes
3d
I’m a Lender zero out-of-pocket does not mean zero cost. Get a full written estimate, preferably on the form called the loan estimate which is official and then check it with another Lender.
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Jose Ramirez
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Investor · Beach park IL · Member since 2022 · 15 posts · 9 votes
3d
Thanks for the feedback I appreciate it and also I wonder if I should look into getting a heloc for investment properties?
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Stacy RaskinBusiness Member
Lender · Member since 2022 · 1k+ posts · 494 votes
3d
Zero cost means generally the lender is inflating the rate or increasing costs in a way that can't be seen by the borrower as lenders are always making money on loans- it's just a question of if they are being transparent about it. DSCR is not regulated the same way as owner occupy loans and loan rates and terms can be changed at any time if you are working with the wrong company.
DSCR loans are structured based on the actual or projected rents for the property and the borrower's credit score. LTV on the loan is based on lower of the appraised value and the contract price. The loan is not based on the borrower's personal income beyond having the money for the down payment if a DSCR purchase.

HELOCs are debt to income / DTI loans so it will depend on your income and debt to income ratio as to what you might qualify for. Also, important to consider the HELOC rate, the cost of holding the money, how much you will make on the new property, if there are lower interest financing options and when you will pay the HELOC back. Happy to connect to discuss further.
[email protected]818-770-0340
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Ray WilliamsBusiness Member
Lender · Denver, CO · Member since 2017 · 148 posts · 68 votes
3d
A true zero out of pocket refi on a DSCR loan almost always means the lender is covering your closing costs with a credit built into a higher rate, not that the costs disappear. DSCR is a Non-QM loan, so make sure you understand the prepayment penalties before getting too excited by what Rocket is telling you. Before you sign anything, ask for the full loan estimate and look at three things. First, is the rate high enough that the lender credit covers all your third party costs, appraisal, title, recording, or just their own origination and processing fees. Second, what is the prepayment penalty structure. A lot of DSCR products carry No, one, three or five year prepayment penalty, and if you plan to sell or refinance again in a couple years that penalty can wipe out any savings from the free closing costs. Third, how is your DSCR ratio being calculated, gross rent against PITIA or against a stressed vacancy number, since that affects both your rate and how much cash out you actually qualify for.

I underwrite these for a living and the pattern I see most often is a borrower focuses on the zero cost part and skips the prepayment penalty question entirely. Get the terms in writing, compare, and not just the note rate, and get a second quote from someone who will walk you through the amortization and penalty schedule line by line before you lock. You may be able to find a broker who can get you a better deal given brokers work directly with wholesale and Rocket is a retail lender. GL!
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Christian TurnerPro Member
Lender · Coral Gables, FL · Member since 2026 · 20 posts · 5 votes
1d
Jose, broker here. "$0 out of pocket" on a DSCR cash-out is real, but it's never free: the lender covers your costs with a lender credit, and the credit is paid for with a higher rate, usually 25-50 bps, for the life of the loan. On a cash-out you can also just roll the costs into the loan amount, which any DSCR lender will do. So the question isn't whether Rocket is good, it's what you're paying for the convenience.
Have them send the Loan Estimate and read three lines: the interest rate, Section A (origination charges) and the lender credit under J. Then get one competing DSCR quote at the same LTV with costs financed instead of credited. Whichever gives the lower rate for the same cash to you wins, because on a 30-year investor loan a quarter point is roughly $8,000-$12,000 on a $300K balance.
Two more things to confirm in writing: the prepayment penalty (a 3-2-1 step-down is standard; 5 years is not) and whether the loan closes in your LLC or your name, since that changes your title and insurance. Happy to run the comparison, no obligation.
786-927-4831
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Erik EstradaBusiness Member
Lender · Member since 2022 · 6k+ posts · 1k+ votes
1d
Yea I agree with@Christian Turner
Don't fall for the bait. You are likely getting a higher rate than normal to cover the origination/lender fees. If you are not rate conscious then yea, it's not a bad deal, however you should cross shop with other lenders to ensure you are not getting overcharged on the rate.
They may also have other stipulations for their DSCR program that may be stricter than a traditional DSCR lender that specializes in the loan. I have heard of a few clients getting denied due to seasoning, occupancy status, etc.. They do best on conforming loans, NON QM is fairly new to Rocket.
[email protected]818-269-7983
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Frankie VozziBusiness Member
Member since 2025 · 332 posts · 82 votes
1h
Jose, I'd look beyond the $0 out-of-pocket piece and compare the full loan structure before deciding.
For a DSCR cash-out refi, I'd want to know the rate, LTV/cash-out amount, points or fees being financed into the loan, prepayment penalty, and total closing costs. Sometimes "$0 out of pocket" simply means certain costs are being structured into the loan rather than disappearing.
I'm on the investor lending side and would be happy to look at the quote with you if you want a second set of eyes on it.
[email protected]516-888-7750
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