Question 1

Can I use projected rent for a DSCR loan if the property is vacant?

Accepted Answer

Most lenders accept an appraisal showing market rent for vacant units. You'll need a rent schedule from the appraiser showing comparable properties. Some require a signed lease before funding.

Question 2

Do I need reserves for an investor loan in Torrance?

Accepted Answer

Expect 6-12 months PITI in reserves per property financed. More properties mean higher reserve requirements. Retirement accounts and other rental income often count toward this requirement.

Question 3

Can I finance a fix-and-flip property with a DSCR loan?

Accepted Answer

No. DSCR loans require the property to be rent-ready at closing. Use hard money or bridge loans for properties needing major rehab, then refinance to DSCR once renovations finish.

Question 4

How do lenders calculate rent for DSCR if I have a tenant paying below market?

Accepted Answer

Most use the lower of actual rent or 75% of appraised market rent. Raising rent before applying helps, but you're stuck with current lease terms if they're significantly below market rates.

Question 5

What's the maximum number of financed properties for investor loans?

Accepted Answer

Conventional caps at 10 financed properties total. Non-QM DSCR lenders often have no limit, though some require commercial loans after 5-10 properties. Portfolio size affects pricing and down payment requirements.

Investor Loans in Torrance: Finance Your Rental Portfolio with Speed and Flexibility