DSCR Lenders That Work With First-Time Investors
Specialist · Member since 2026 · 53 posts · 25 votes
DSCR Lenders That Work With First-Time Investors
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Chesapeake, VA · Member since 2025 · 1 post · 2 votes
4moHi Pavel,
I work with a private lending group (Coastal Capital Funding) that lends nationally, including Michigan, and we regularly close DSCR deals for first-time investors in LLCs. I'm happy to at least give you a comparison point or sanity check on a deal if helpful.
Feel free to email me [email protected] or give me a call at 757-754-1121 if you want to run numbers or see what terms might look like, no pressure at all. And good luck on the first one… that’s the hardest (and most important) step.
17 Replies
- Lender · Lake City, MI · Member since 2019 · 118 posts · 42 votes5mo
Welcome!! You’re thinking about this the right way, especially focusing on the deal’s cash flow first.
I'm a mortgage loan officer and I work with DSCR lenders that are very comfortable with exactly this profile,
including:
• First-time investors
• No primary residence
• LLC vesting at closing
This scenario isn’t as uncommon as some make it sound—the key is lining you up with the right lender from the start so you’re not getting bounced around or told “no” by overlays that don’t actually apply across the board.
A couple quick things to keep in mind as you move forward:
• DSCR and reserves will drive approval more than anything else
• Credit and liquidity still matter, even though income isn’t the focus
• Having your LLC structured correctly before going under contract can save you time at closing
If you want, I’m happy to take a quick look at what you’re targeting and either:
• Point you to the best-fit lender, or
• Help you get prequalified so you can move quickly when you find a deal
Feel free to DM me—always glad to help, even if it’s just to give you clarity on options.
- 5moAJ ExnerPro MemberLender · Springfield, MO · Member since 2023 · 648 posts · 310 votes
Hey Pavel,
Should be plenty of groups that could do something like that, I do know that the Michigan Landlord laws are a little different so there are a few lenders that tend to avoid MI
That being said, pushing MI lenders and being first timers might be enough that you might want to price out a few brokers. There are a few 'high volume' brokers who could price out pretty well in the DSCR space because of the volume that they work with and their knowledge of certain regions.
Good luck!
- 5moDevin PetersonBusiness MemberLender · Sarasota, FL · Member since 2022 · 2k+ posts · 664 votes
Quote from @Pavel Voroniuk:
Hey BP community,
My partner and I are actively looking to acquire our first rental property in the Berrien Springs / Benton Harbor, MI area and are in the process of finalizing our Michigan LLC.
We're looking for DSCR lender recommendations - specifically ones that are comfortable with:
• First-time investors (no prior rentals)
• Borrower without a primary residence
• LLC vesting on the loan
We understand the property’s cash flow is what carries the loan, and we’re targeting deals where the numbers work. We have our down payment capital ready and are serious about closing.
If you’ve worked with a lender in Michigan (or a national lender who closes deals here) that didn’t make first-timer status a dealbreaker, I’d love a name and contact. Direct lenders preferred over brokers.
Appreciate any insight - this community has been invaluable.Why are direct lenders preferred over brokers? You do realize that brokers have a better chance of getting you the best terms and connections with exclusive programs right? You don’t have to worry about points and fees being doubled. There are no points programs
ProAlpha Capital4.47 Reviews - 5moStacy RaskinBusiness MemberLender · Member since 2022 · 1k+ posts · 490 votes
There are less DSCR lenders that work with first time investors who also don't own property but they exist. Happy to connect to discuss further. I'll send you a direct message.
Bright Skyline518 Reviews - 4moRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
Quote from @Pavel Voroniuk:
Hey BP community,
My partner and I are actively looking to acquire our first rental property in the Berrien Springs / Benton Harbor, MI area and are in the process of finalizing our Michigan LLC.
We're looking for DSCR lender recommendations - specifically ones that are comfortable with:
• First-time investors (no prior rentals)
• Borrower without a primary residence
• LLC vesting on the loan
We understand the property’s cash flow is what carries the loan, and we’re targeting deals where the numbers work. We have our down payment capital ready and are serious about closing.
If you’ve worked with a lender in Michigan (or a national lender who closes deals here) that didn’t make first-timer status a dealbreaker, I’d love a name and contact. Direct lenders preferred over brokers.
Appreciate any insight - this community has been invaluable.When you say partner and I and "borrower without a primary residence" -- does that mean one of the two borrowers have a primary residence or no primary residences on any of the borrowers at all? Thats likely going to be a key question for you here:
Here's a helpful resource on this distinction (critical for eligiblity with most DSCR Lenders):
First-Time Investor vs. First-Time Homebuyer for DSCR Loan Qualification
Another important distinction regarding experience requirements to qualify for a DSCR Loan is between and first-time homebuyers. While first-time investors can generally qualify for DSCR Loans with most lenders subject to minor restrictions, first-time homebuyers (i.e. borrowers who have not recently owned any sort of residential real estate like a primary home) typically cannot qualify for a DSCR Loan. Lenders understand that owning a residence comes with many learning experiences and responsibilities, and many investors use lessons from owning their first home, or through “house-hacking,” to aid in operating their first investment property successfully. Unfortunately for individuals wanting to dive into real estate investing before owning a primary residence themselves, DSCR Loans are typically not an option.
It’s important to note that like the distinctive definition of "first-time investor" for mortgage qualifying purposes, DSCR Lenders use a similar definition redefining first-time homebuyer in this context to mean not owning a primary home in the last three years. While this may appear to be an overly cautious and unreasonable guideline, particularly for older investors who have owned their home for many years and downsized to renting a smaller home as “empty nesters” for example, mortgage lenders are constantly on high-alert for indications of mortgage fraud. Of particular concern in this context is occupancy fraud, or when borrowers falsely attest that they plan to use a property for business purposes only to qualify for a DSCR loan, while secretly planning to occupy the property. This seemingly harsh restriction and definition of “first-time homebuyer” (“first time” meaning if they haven’t owned in the last three years instead of a true “first”) likely exists as an anti-fraud measure that may inadvertently exclude well-qualified borrowers.
- 4moErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
Quote from @Pavel Voroniuk:
Hey BP community,
My partner and I are actively looking to acquire our first rental property in the Berrien Springs / Benton Harbor, MI area and are in the process of finalizing our Michigan LLC.
We're looking for DSCR lender recommendations - specifically ones that are comfortable with:
• First-time investors (no prior rentals)
• Borrower without a primary residence
• LLC vesting on the loan
We understand the property’s cash flow is what carries the loan, and we’re targeting deals where the numbers work. We have our down payment capital ready and are serious about closing.
If you’ve worked with a lender in Michigan (or a national lender who closes deals here) that didn’t make first-timer status a dealbreaker, I’d love a name and contact. Direct lenders preferred over brokers.
Appreciate any insight - this community has been invaluable.Hey Pavel,
Curious to know why you'd prefer to work with a direct lender over a broker?
Nothing going wrong with working with a direct lender, however you put yourself at risk for a potential deal fall out or bait and switch.
Truthfully everyone wants business, both brokers and direct lenders. I find that the more seasoned you are with lending, the less likely you will get screwed over. Having a broker guide you from point A to B will help ensure a timely closing, no surprises, and a clear plan.
Now once you are familiar with the ins and outs, have multiple loans closed and your deals are cookie-cutter, direct lending will be more beneficial and less of a hassle, since you'll know exactly what to provide, will know the lender's guidelines, and can work on a lower fee schedule with more loans per month.
My best recommendation is to interview both, get terms from both and see which one is the best option.
LuxePrivate Investments LLC 571 Reviews - 4moMatthew BernalBusiness MemberInvestor · Austin, TX · Member since 2021 · 497 posts · 126 votes
All three of your criteria are workable on DSCR — you're in better shape than you might think.
First-timer status isn't a dealbreaker on most DSCR programs because qualification is based on the property's cash flow not your experience. No primary residence is fine. LLC vesting is standard.
I work with investors on DSCR in Michigan and happy to run through what terms look like on your deal.
Do you have a property identified yet or still in the search phase?
- Chesapeake, VA · Member since 2025 · 1 post · 2 votes4mo
Hi Pavel,
I work with a private lending group (Coastal Capital Funding) that lends nationally, including Michigan, and we regularly close DSCR deals for first-time investors in LLCs. I'm happy to at least give you a comparison point or sanity check on a deal if helpful.
Feel free to email me [email protected] or give me a call at 757-754-1121 if you want to run numbers or see what terms might look like, no pressure at all. And good luck on the first one… that’s the hardest (and most important) step.
- 4moScott AlfanoBusiness MemberLender · Seattle, WA · Member since 2013 · 64 posts · 20 votes
Hey Pavel, I'm sure it's been mentioned by others but no one cares that you would be a first time landlord for the DSCR. That's most of the DSCR loans I do. All that matters is the rent covering the monthly cost of the loan and a halfway decent credit score. You don't need a primary, and your LLC can do the loan if that's the entity that buys the investment property.
- 4moRobin SimonBusiness MemberLender · Austin, TX · Member since 2022 · 5k+ posts · 4k+ votes
Quote from @Scott Alfano:
Hey Pavel, I'm sure it's been mentioned by others but no one cares that you would be a first time landlord for the DSCR. That's most of the DSCR loans I do. All that matters is the rent covering the monthly cost of the loan and a halfway decent credit score. You don't need a primary, and your LLC can do the loan if that's the entity that buys the investment property.
I think it is a stretch to say "no one cares" on first time investor status for a DSCR Loan - there is the nuance with a lot of lenders FTHB vs. FT Investor and many that do work with first time investors likely have some minor restrictions
- Member since 2026 · 129 posts · 21 votes4mo
Quote from @Pavel Voroniuk:
Hey BP community,
My partner and I are actively looking to acquire our first rental property in the Berrien Springs / Benton Harbor, MI area and are in the process of finalizing our Michigan LLC.
We're looking for DSCR lender recommendations - specifically ones that are comfortable with:
• First-time investors (no prior rentals)
• Borrower without a primary residence
• LLC vesting on the loan
We understand the property’s cash flow is what carries the loan, and we’re targeting deals where the numbers work. We have our down payment capital ready and are serious about closing.
If you’ve worked with a lender in Michigan (or a national lender who closes deals here) that didn’t make first-timer status a dealbreaker, I’d love a name and contact. Direct lenders preferred over brokers.
Appreciate any insight - this community has been invaluable.We're actively lending on DSCR deals in Michigan and other Midwest markets.
What you’re describing is doable, but I’ll be direct — most lenders won’t have an issue with first-time investors, the real friction usually comes from:
– property cash flow (true DSCR vs projected rents)
– liquidity / reserves
– and how clean the LLC structure is at closing
No primary residence is not a deal breaker on our side if the deal itself stands on its own.
If you already have a deal in mind, feel free to share the numbers — happy to give you quick feedback on whether it’s financeable or not.
- Member since 2026 · 35 posts · 3 votes4mo
Quote from @Pavel Voroniuk:
Hey BP community,
My partner and I are actively looking to acquire our first rental property in the Berrien Springs / Benton Harbor, MI area and are in the process of finalizing our Michigan LLC.
We're looking for DSCR lender recommendations - specifically ones that are comfortable with:
• First-time investors (no prior rentals)
• Borrower without a primary residence
• LLC vesting on the loan
We understand the property’s cash flow is what carries the loan, and we’re targeting deals where the numbers work. We have our down payment capital ready and are serious about closing.
If you’ve worked with a lender in Michigan (or a national lender who closes deals here) that didn’t make first-timer status a dealbreaker, I’d love a name and contact. Direct lenders preferred over brokers.
Appreciate any insight - this community has been invaluable.Hey Pavel, great job getting everything lined up before your first purchase—having the LLC formed and capital ready already puts you ahead of a lot of first‑timers.
On the DSCR side, there are lenders that will work with first‑time investors, no primary residence, and LLC vesting, but the key is structuring the deal so it's really clean on DSCR, reserves, and documentation. In my experience, once you're above a solid coverage ratio and have your down payment and basics dialed in, "first‑timer" becomes less of a hard stop and more of a risk factor they price around.
One thing I’d suggest as you’re targeting Berrien Springs / Benton Harbor is to think a level up from just “who will lend” and also look at where your first few deals are. Markets like Cleveland, for example, can be very tough for non‑locals because of hyper‑local block‑by‑block dynamics, older housing stock, code enforcement, and shifting regulations that tend to hit out‑of‑area owners hardest. Those kinds of factors usually don’t show up in a spreadsheet, but they matter a lot once you own the property and can impact both lender comfort and your actual performance.
Every week I review updated data on where capital is flowing, rent and price trends, and which markets are treating small investors (especially new ones) reasonably well versus where regulations, enforcement, or operational challenges are making it harder to succeed. A big theme lately has been: it’s usually better for newer investors to start in markets where you either (1) are local, or (2) can build a trustworthy, hands‑on team quickly, rather than chasing “cheap” or “high cash‑on‑paper” markets that are notorious for being unforgiving if you’re not on the ground.
For your situation, since you're focused on west Michigan, I'd personally lean into understanding the local fundamentals really well—rents by micro‑neighborhood, which pockets are actually investor‑friendly, realistic repair costs, and exit strategies—and then match that to lenders who already have a track record closing DSCR deals in Michigan with newer investors. The lender is important, but the combination of market choice plus lender fit is what will make that first deal a smoother experience.
Happy to share more detail on what I'm seeing in current "first‑deal‑friendly" markets or how to frame your DSCR file so it's easier for lenders to say yes. Either way, you're on the right track by asking these questions before you write offers.
- 4moVijay FriedmanBusiness MemberMiami, FL · Member since 2026 · 766 posts · 121 votes
Quote from @Pavel Voroniuk:
Hey BP community,
My partner and I are actively looking to acquire our first rental property in the Berrien Springs / Benton Harbor, MI area and are in the process of finalizing our Michigan LLC.
We're looking for DSCR lender recommendations - specifically ones that are comfortable with:
• First-time investors (no prior rentals)
• Borrower without a primary residence
• LLC vesting on the loan
We understand the property’s cash flow is what carries the loan, and we’re targeting deals where the numbers work. We have our down payment capital ready and are serious about closing.
If you’ve worked with a lender in Michigan (or a national lender who closes deals here) that didn’t make first-timer status a dealbreaker, I’d love a name and contact. Direct lenders preferred over brokers.
Appreciate any insight - this community has been invaluable.For first-time investors, DSCR is still possible, but lender selection matters.
Some DSCR lenders are fine with no prior rental history as long as the borrower has:
- solid FICO
- enough reserves
- good down payment
- clean LLC docs
- property cash flow supports DSCR
- no primary residence requirement
- investment-purpose transaction only
The two things I'd confirm early are whether the lender requires the borrower to own a primary residence and whether they allow first-time investors with LLC vesting. Some DSCR lenders are flexible on this, while others add overlays or reduce leverage.
Since you already have down payment capital ready and are targeting cash-flowing deals, this sounds workable if the property numbers support it.
- 1moIrv ArreolaPro MemberLender · Los Angeles CA · Member since 2026 · 25 posts · 2 votes
- Member since 2024 · 6 posts · 0 votes1mo
I'd be glad to help if you're still comparing lenders. I work with multiple DSCR investors and can usually shop several options based on your goals. If you send me the property details, estimated value, current loan balance, rental income, and whether you're targeting 75% or 80% LTV, I'll let you know what programs may be available.
- Real Estate Agent · NJ · Member since 2021 · 565 posts · 127 votes1mo
I work with Constructive Capital for DSCR loans (1 to m4 Units) and we can work with first time investors as long as you can show you are renting for 12 months, you don't need to have a previous mortgage.
- 1moReginald TrussPro MemberLender · Toledo, OH · Member since 2015 · 1k+ posts · 96 votes
Hi Pavel, I work with several investment-property lenders that finance first-time investors, LLCs, and DSCR loans in Michigan. If you haven't found the right fit yet, I'd be happy to see if one of my lending partners matches your scenario. Feel free to send me a DM with the property details.
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