Debt Service Coverage Loan

A Debt Service Coverage Ratio (DSCR) loan is a valuable tool for real estate investors seeking to expand their portfolios without the hurdles of traditional loan requirements. This type of non-QM loan is specifically designed for investors who may not qualify for conventional loans due to their unique income situations, often lacking traditional income verification like tax returns or pay stubs.

What is a Debt Service Coverage Loan?

A DSCR loan is tailored for real estate investors. Instead of relying on income verification, lenders use the debt service coverage ratio to assess a borrower’s ability to repay the loan. This method streamlines the approval process, making it an ideal option for those who can’t meet the criteria of conventional loans due to the nature of their investments and income.

Who is a DSCR Loan for?

Investors without Traditional Income Documentation: Ideal for those who cannot or do not want to provide employment details, tax returns, payslips, or W2s.
Self-Employed Borrowers: Especially beneficial for self-employed individuals with complex or irregular incomes.
Experienced Investors: Suitable for those who own multiple properties and have reached the traditional credit limit on conventional loans.

DSCR Loan Requirements

Credit Score: A minimum credit score of 680 is typically required, with better rates available for higher scores.
Down Payment: Most lenders require a minimum down payment of 25% of the property’s purchase price.
DSCR: A minimum debt service coverage ratio of 1.2, meaning the property’s rent must exceed its expenses.
Property Value: Many lenders set a minimum property value of $150,000.

By meeting these requirements, investors can leverage DSCR loans to acquire, hold, or trade investment properties, offering a flexible and efficient financing solution.

Suncoast Mortgage Firm LLC.

Our lending solutions use the perfect hybrid of human-driven insights and technical prowess to process loans faster and significantly reduce costs.

PHONE

(813) 599-3533

E-MAIL

tony@suncoastmortgagefirm.com

ADDRESS

8270 Woodland Center Blvd
Tampa, FL 33614

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Website Disclaimer :

Effective Date: 9/1/2021
All loan approvals are conditional, not guaranteed, and subject to lender review of all information. A loan is conditionally approved when the lender has issued an approval in writing, but until all conditions are met, a loan cannot be funded. Specified rates may not be available for all borrowers. interest rates, and program guidelines, and are subject to change without notice based on applicant’s eligibility and market conditions. Suncoast Mortgage Firm LLC. is an Equal Opportunity Mortgage Broker headquartered in Tampa, Florida. This licensee is performing acts for which a mortgage broker license is required. Suncoast Mortgage Firm LLC. is licensed by the Florida Office of Financial Regulation, NMLS# 1936558. Suncoast Mortgage Firm LLC. is approved to originate Conventional, FHA, VA, and USDA loans, and has the ability to broker such loans to Conventional, FHA, VA, and USDA approved lenders. Suncoast Mortgage Firm LLC. is not acting on behalf of or at the direction of HUD/FHA or the VA.

Debt Service Coverage Loan