DSCR Lenders lending to a LLC

[John Jacobs]

Do DSCR Lenders lending to a LLC typically require a Personal Guarantee from the Member(s) of the LLC?

[Alex Bekeza]

@John Jacobs Yes, your typical DSCR loan on a 1-4 unit property will be "full recourse". They'll allow LLC vesting and the use of LLC as borrower but will still require a guarantee from a warm body guarantor who owns at least 20% of the entity and use that persons credit score (mid FICO) to determine pricing and qualification. However, these loans typically do NOT report to your personal credit even when you're the guarantor.