DSCR refinance 80 or 85% LTV

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Robin SimonBusiness Member
Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
3y
Quote from @Ivan May:

Has anyone worked with DSCR lenders providing this kind of product? I see a lot of 70-75% LTV, but I thought I would ask.

Thanks in advance!


Generally, 80% refinances are widely available if its a rate term refinance (less than $2,000 cash out at closing) and 75% LTV for cash-out refinances. There are some options for 80% Cash-Out Refis out there but its going to be hard to make work where rates are, considering that product is going to be pretty conservative (must cash flow at lower of in-place and long term rents - no STRs for example) and will likely have at least 6 months seasoning requirements

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  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    3y

    I have never seen it, I don’t see a need for it as I doubt there will be cash flow with that high of a loan to value.

    1Reply
  • Devin PetersonBusiness Member
    Lender · Sarasota, FL · Member since 2022 · 2k+ posts · 673 votes
    3y
    Quote from @Ivan May:

    Has anyone worked with DSCR lenders providing this kind of product? I see a lot of 70-75% LTV, but I thought I would ask.

    Thanks in advance!


    Hi yes, there are still investors out there that can do 80LTV cash out. Only on SFH investment. Must be long term rentals, 2-4 units are maxed at 75ltv

    [email protected]860-538-3672
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  • Alex BekezaBusiness Member
    Lender · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    3y

    @Ivan May 75% is the industry standard max for cash out. 

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  • Ivan May
    OP
    Rental Property Investor · Austin, TX · Member since 2017 · 30 posts · 15 votes
    3y

    @Devin Peterson

    Appreciate the info Devin. I have an off market deal I recently closed on that I am rehabbing in the Indy metro and looking to refi. I’ll be in touch.

    0Reply
  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    3y

    First question to ask is what are market rents in Indiana``` $1100 depending on location less or more. That number is going to dictate what loan amount you can get. DSCR is cash flow only plus you need reserves.

    Next question is how many credit cards/mortgages/student loans/vehicle loans on your credit report for the reserve number.

    Third is what are the comparable sales with a loan closed past three months in proximity and similar square footage.

    From these three numerical facts you can figure a DSCR.

    80% for SFR non owner only but you need to meet the calculations including above

    70% - 75 for 2-4  75 if you have 740 FICO and experience and 24 months reserves

    The lenders that advertised 80 and 85 in the past are folded or not taking that risk today.

    1Reply
  • Robin SimonBusiness Member
    Lender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
    3y
    Quote from @Ivan May:

    Has anyone worked with DSCR lenders providing this kind of product? I see a lot of 70-75% LTV, but I thought I would ask.

    Thanks in advance!


    Generally, 80% refinances are widely available if its a rate term refinance (less than $2,000 cash out at closing) and 75% LTV for cash-out refinances. There are some options for 80% Cash-Out Refis out there but its going to be hard to make work where rates are, considering that product is going to be pretty conservative (must cash flow at lower of in-place and long term rents - no STRs for example) and will likely have at least 6 months seasoning requirements

    [email protected]
    Harpoon Capital514 Reviews
    WebsiteView Page
    2Reply
  • Doug SmithPro Member
    Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
    3y

    The funds that back securitizations of DSCR deals backed off of their LTVs. We don't have anything at 85% any more, but 80% is doable.Cash-out refis back off a bit (normally 5% off the LTV). Things change periodically, so count on LTVs changing.

    1Reply
  • Stephanie P.Pro Member
    Washington, DC Mortgage Lender/Broker · Member since 2016 · 4k+ posts · 2k+ votes
    3y
    Quote from @Ivan May:

    Has anyone worked with DSCR lenders providing this kind of product? I see a lot of 70-75% LTV, but I thought I would ask.

    Thanks in advance!


    It's offered, but with the rates where they are, the DSCR doesn't usually work. 75% is the norm.

    1Reply
  • Ivan May
    OP
    Rental Property Investor · Austin, TX · Member since 2017 · 30 posts · 15 votes
    3y

    @Laurie Souza

    Thank you Laurie! I’ll be reaching out soon.

    0Reply
  • Nick BelskyBusiness Member
    Lender · Orlando, FL · Member since 2021 · 1k+ posts · 704 votes
    3y

    @Ivan May

    85LTV is a unicorn.

    80LTV, yes, but with 6 month seasoning. I've been quoting/closing between 8.5-9% on them at par with a 1.00 DSCR min.

    Definitely better pricing at 75LTV and only 3 months to season.

    Cheers!

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    0Reply
  • Xavier Aliche
    Rental Property Investor · Houston, TX · Member since 2020 · 23 posts · 5 votes
    3y
    Quote from @Devin Peterson:
    Quote from @Ivan May:

    Has anyone worked with DSCR lenders providing this kind of product? I see a lot of 70-75% LTV, but I thought I would ask.

    Thanks in advance!


    Hi yes, there are still investors out there that can do 80LTV cash out. Only on SFH investment. Must be long term rentals, 2-4 units are maxed at 75ltv

    Let’s connect 
    0Reply
  • Brandon L. WarthenPro Member
    FL · Member since 2020 · 2 posts · 0 votes
    3y

    Yes, they are still out there. Also, I just got word today about a lender willing to do a 2nd position DSCR!

    0Reply
  • Fernando Corona
    Lender · CA - FL - GA · Member since 2022 · 33 posts · 18 votes
    2y

    I've got lenders that do 85% LTV on purchases if DSCR ratio is over 1.0 and I CAN DO 80% LTV EVEN IF DSCR RATIO IS UNDER 1.0! interest rate takes a beating but we can do it. we can also do 80% cash out refi's with DSCR greater than 1.0. We also accept air bnb income if we need to if long term rents dont support DSCR.

    0Reply
  • Erik EstradaBusiness Member
    Lender · Member since 2022 · 6k+ posts · 1k+ votes
    2w

    It exists now, however the requirements are a bit of a challenge. Happy to chat!

    [email protected]818-269-7983
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