DSCR vs Hard Money Lenders

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DSCR vs Hard Money Lenders

Ron Amshalom
New to Real Estate · Israel · Member since 2025 · 26 posts · 14 votes

Hi everyone,
I learned that the best loan for BRRRR, specific for foreigners is DSCR.
Are there situations when private and hard money lending is more recommended? 
Thanks in advance, 
Ron

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  • Devin PetersonBusiness Member
    Lender · Sarasota, FL · Member since 2022 · 2k+ posts · 667 votes
    1y
    Quote from @Ron Amshalom:

    Hi everyone,
    I learned that the best loan for BRRRR, specific for foreigners is DSCR.
    Are there situations when private and hard money lending is more recommended? 
    Thanks in advance, 
    Ron


     Depends entirely upon your project purpose. What is your objective? What are you trying to accomplish - purchase turn key ready units? Or renovate with a construction budget 

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  • Zach Berry
    Lender · Pittsburgh, PA · Member since 2024 · 63 posts · 20 votes
    1y

    Ron, typically a soup-to-nuts BRRRR will look like this:

    1. Fix/flip loan to acquire the house.

    2. Renovate it.

    3. Refinance with a DSCR loan.

    DSCR loans can be few and far between for real ITIN borrowers without a visa or credit score, but you'll be alright if you have both of those things. Hope this helps!

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  • Ned CareyPro Member
    Moderator
    Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
    1y

    @Ron Amshalom Hard Money loans are for renovations not long term holds. DSCR is for long term holds but some DSCR lenders may have programs for renovation then conversion to permanent financing.

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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    1y
    Quote from @Ron Amshalom:

    Hi everyone,
    I learned that the best loan for BRRRR, specific for foreigners is DSCR.
    Are there situations when private and hard money lending is more recommended? 
    Thanks in advance, 
    Ron


    This depends on what you are looking for. DSCR is long term where you have cash coming in - private lending/hard money is shorter term financing typically considered bridge debt for things like finishing a project or other reasons. Private / Hard money is almost always a lot more expensive than DSCR loans.

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  • Noah WrightBusiness Member
    USA, Nationwide · Member since 2024 · 174 posts · 90 votes
    1y

    Absolutely! Happy to help --

    [email protected]737-773-3717
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  • Ryan RomingerBusiness Member
    Real Estate Broker · Indianapolis, IN · Member since 2018 · 340 posts · 144 votes
    1y

    DSCR loans are often a great option for foreign investors using the BRRRR strategy since they're based on the property's income, not your personal income or residency. However, private or hard money loans can make more sense at the start, especially if the property needs major rehab or isn't rent-ready. They're faster to close and more flexible with unconventional deals. Once the property is renovated and leased, you can refinance into a DSCR loan for better long-term terms. In most BRRRR cases, private or hard money is best for acquisition, and DSCR is used for the refinance.

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