Anyone Using DSCR Loans to Transition from Flips to Rentals?

[Kelly Schroeder]

I've been talking with investors who started with flips but now want to hold rentals without hitting the wall of conventional financing. DSCR loans keep coming up as a tool for that.

For those who’ve made the shift:

- Did DSCR help you scale faster into buy-and-hold?
- Were the cash flow metrics tough to meet compared to traditional approvals?
- Any lessons from moving from short-term profit (flips) to long-term holds with DSCR?

I’d love to hear how you’re balancing flips and rentals while keeping momentum.

[Wyatt Ferm]

Hey Kelly - I work for a hard money lender and many of the investors I work with utilize DSCR loans. The BRRRR method is a common strategy used where investors will rehab a house and then refi into a DSCR loan to rent it out. If ARV is high enough you can get your entire initial downpayment back out once you refi into a DSCR loan which is a really great way to scale a long-term hold portfolio quickly.

That said, it ultimately comes down to the specifics of the deal.