Looking for a DSCR Loan for a single Family with ADU

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Looking for a DSCR Loan for a single Family with ADU

Frankie Perez
Member since 2021 · 10 posts · 13 votes

Im looking for a DSCR loan for a rental property I own in ST Petersburg, FL. It's a SFH with ADU and brings $2400 per month. No more than 2 points and hoping for low interest rate.

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  • Alex BekezaBusiness Member
    Lender · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    3y

    @Frankie Perez I'd be happy to put a quote on your desk. Feel free to reach out anytime. Today's DSCR rates have crept into the 8s alongside unrelenting 10 year treasury movement and origination is flexible depending on loan amount.

    [email protected]818-606-8823
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    0Reply
  • Logan Singleton
    Lender · Boston, MA · Member since 2023 · 415 posts · 95 votes
    3y

    Hi Frankie,

    I have sent you a PM

    0Reply
  • Frankie Perez
    OP
    Member since 2021 · 10 posts · 13 votes
    3y
    Quote from @Alex Bekeza:

    @Frankie Perez I'd be happy to put a quote on your desk. Feel free to reach out anytime. Today's DSCR rates have crept into the 8s alongside unrelenting 10 year treasury movement and origination is flexible depending on loan amount.


     Hi Alex, Property value is $200k plus, no mortgage, rent $2400, taxes $1300 and ins $1600

    0Reply
  • Alex BekezaBusiness Member
    Lender · Los Angeles, CA · Member since 2018 · 2k+ posts · 1k+ votes
    3y

    @Frankie Perez Okay, I'm going to DM you a link to complete so I can have all of the information I need to dial in a detailed quote. 

    [email protected]818-606-8823
    Investor Property Loan5307 Reviews
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  • Stacy RaskinBusiness Member
    Lender · Member since 2022 · 1k+ posts · 522 votes
    3y

    @Frankie Perez, DSCR loans is one of our specialties.

    In case helpful, here's some more information on what goes into DSCR rates besides present market conditions. DSCR loans are based off of down payment, credit score and either actual or market rents so it helps to supercharge an investor's real estate goals and net worth.

    Here's a bit more in detail about how rates are calculated for DSCR loans:

    1. Credit score- the higher the best. 760+ generally gets best pricing for investment property loans with most lenders

    2. Loan to value ratio: The higher the loan to value ratio (LTV) is, pricing takes a hit. So your pricing will be higher for a 80% LTV loan than for a 60% LTV loan.

    3. Prepayment penalties- usually 1-5 year terms. The shorter the prepayment term has an impact on increasing the rate.

    4. Are you cash flowing the property? More on how that is calculated below. Is your DSCR ratio greater than 1-meaning are you cash flowing (according to the lender's criteria of mortgage, property taxes and insurance (and HOA) if applicable). Many lenders will not do a DSCR loan unless cash flowing. If they will do a loan with less than 1, the pricing takes a hit. This criteria is for 1-4 and 5-8 unit programs.

    I've included an example below to help illustrate this.

    So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.

    See example below:

    DSCR < 1

    Principal + Interest = $1,700

    Taxes = $350, Insurance = $100, Association Dues = $50

    Total PITIA = $2200

    Rent = $2000

    DSCR = Rent/PITIA = 2000/2200 = 0.91

    Since the DSCR is 0.91, we know the expenses are greater than the income of the property.

    DSCR >1

    Principal + Interest = $1,500

    Taxes = $250, Insurance = $100, Association Dues = $25

    Total PITIA = $1875 Rent = $2300

    DSCR = Rent/PITIA = 2300/1875 = 1.23

    DSCR lenders generally let you vest either individually or as an LLC. It's a great way to increase your net worth and these loans can also be used to pull cash out of a property as it appreciates allowing you to reinvest money into new deals.

    [email protected]818-770-0340
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  • Erik EstradaBusiness Member
    Lender · Member since 2022 · 6k+ posts · 1k+ votes
    3y
    Quote from @Frankie Perez:

    Im looking for a DSCR loan for a rental property I own in ST Petersburg, FL. It's a SFH with ADU and brings $2400 per month. No more than 2 points and hoping for low interest rate.


     Hey Frankie, 

    Is the goal to refinance again in the next 3 years? Most DSCR Lenders will require a 5 year prepay for the lowest rate. There are some lenders that will allow you to finance those origination fees and not affect your cash out.

    [email protected]818-269-7983
    LuxePrivate Investments LLC 570 Reviews
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    0Reply
  • Devin PetersonBusiness Member
    Lender · Sarasota, FL · Member since 2022 · 2k+ posts · 676 votes
    3y

    Hi Frankie, Local to you in St Pete. Id be happy to connect. There are tons of great wholesale DSCR lenders that will do this deal.

    [email protected]860-538-3672
    ProAlpha Capital55 Reviews
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    0Reply
  • Matthew DaviesBusiness Member
    Lender · Tampa, FL · Member since 2023 · 22 posts · 6 votes
    3y

    Hi Frankie, we're a private lender based in Tampa - our specialty is DSCR loans. Happy to provide guidance!

    [email protected]
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