Question 1

Can I use projected rent for a property I'm buying?

Accepted Answer

Yes, the appraisal includes a market rent analysis showing what the property should rent for in current conditions. You don't need an existing lease in place, though having one can strengthen your application.

Question 2

Do DSCR loans work for multifamily properties in East Palo Alto?

Accepted Answer

DSCR loans work for 1-4 unit properties including duplexes, triplexes, and fourplexes. Each unit's rental income contributes to the total DSCR calculation, often making multifamily properties easier to qualify.

Question 3

What if my DSCR is below 1.0?

Accepted Answer

Some lenders approve DSCR ratios as low as 0.75 with compensating factors like larger down payments or higher credit scores. Rates increase as DSCR decreases, so expect higher pricing below 1.0.

Question 4

How quickly can I close a DSCR loan?

Accepted Answer

DSCR loans typically close in 21-30 days since there's no employment or income verification. The appraisal with rent schedule is the critical timeline factor that determines actual closing speed.

Question 5

Can I use DSCR loans to buy multiple East Palo Alto properties?

Accepted Answer

Yes, DSCR loans have no portfolio size restrictions. Experienced investors use them to acquire multiple properties simultaneously or in succession, limited only by available capital and qualifying ratios.

DSCR Loans in East Palo Alto: Income Property Financing Without Income Documentation