Best for real estate investors looking to finance long-term rental properties.
- Qualify using future rental income
- Not based on personal income
- Simple process
Loan Terms
| Loan to value | Up to 80% LTV |
| Loan amount | Min $75,000 |
| Interest rate | Start at 7.50% |
| Credit score | Minimum 680 |
| Loan types | Fixed rates, interest only, 5/1 + 7/1 ARM’s |
Our Advantages
- Fast closings
- $0 application fee ($1,500 savings)
- Simple process
- No W-2 or tax returns needed
- No experience required
Approval based on property generating enough current or future rental income to cover monthly debt payments.
Long-Term Rental Loan Process
- Get pre-qualified to see how much you can borrow, your down payment and interest rate.
- Approve loan terms when you’re ready to move forward.
- Complete loan application.
- Underwriter runs your credit.
- If approved, an appraisal is ordered.
- Underwriter looks at comparables and calculates potential rental income that the property can generate.
- Underwriters check if long-term rental income will cover monthly loan payments, property taxes and insurance.
- Underwriter calculate your debt service coverage ratio (DSCR). Higher DSCR ensures loan repayment.
- If the DSCR meets the lender’s loan criteria, the loan is approved.
- Title agency and funding department work together to close the loan.
Tips for 30-Year Rental Loans
- Close before the end of the month to pay less at closing for prorated interest.
- Good credit scores get lower interest rates, so refinance your personal debt to apply with a minimum credit score of 680.
- If your credit score is 660-680, consider a short term bridge loan to buy the rental property, but delay long term financing.
- If you have multiple business partners, apply with who has the best credit score.
- Save time by finding your Articles of Organization, Operating Agreement and EIN letter.
- Have the potential rental income, property taxes and insurance cost ready.
- Avoid seller concessions. Most lenders will deny a loan when a seller pays more than 3% towards closing costs.
- Find an insurance agent that is familiar with rental properties.
- Avoid applying to many hard money lenders. Some private lenders run a hard pull on your credit, lowering your score.
- Do not apply for an FHA loan if you’re applying for a DSCR loan. Traditional lenders will run a hard pull on your credit report, lowering your credit score.
- Apply for a DSCR rental loan which is specifically designed for real estate investors who use tax advantages.
Have a Question?
Have a question about long-term rental loans or ready to apply? Give us a call. We’re happy to help.
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