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DSCR or conventional refi?
We purchased a rental in VA (live in NC) and established a VA LLC. We bought it with 40% down in cash and the remainder using private money. It now has 6 months or rental history (more if you include the previous ownership) and we need to refi the private money loan. What would you do? A DSCR loan — even though the rates are higher — or a conventional refi? Any other option you'd consider. (High credit score and a strong financial portfolio). Thanks in advance!
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#1 Private Lending & Conventional Mortgage Advice Contributor
- Lender
- Charleston, SC
Is the title to the deed currently held by the LLC? If so, you wont be able to get a Conventional loan without moving title back to your individual ownership.
Apples to apples, Conventional typically offers a marginally better deal than a DSCR from a bang-for-the-buck perspective. However, if your entity currently owns this property, I would just use a DSCR. After you account for the costs and headaches of transfering ownership, it likely wouldnt be worth it.
- Patrick Roberts
