Question 1

Can I use DSCR loans for properties I don't own yet?

Accepted Answer

Yes, most DSCR lenders finance purchases and refinances. The appraisal includes market rent analysis to calculate DSCR for purchase scenarios.

Question 2

What if my property is vacant right now?

Accepted Answer

Lenders use the appraised market rent, not actual rent. A vacant unit won't disqualify you as long as the market rent supports the DSCR.

Question 3

Do I need reserves for a DSCR loan?

Accepted Answer

Most lenders require 6-12 months of PITIA in reserves per property. Portfolio investors face higher reserve requirements across all financed rentals.

Question 4

Can I get a DSCR loan with a bankruptcy on record?

Accepted Answer

Some lenders allow it if the bankruptcy is discharged and you meet minimum seasoning requirements. Credit score and DSCR matter more than the bankruptcy itself.

Question 5

How does a 1031 exchange work with DSCR financing?

Accepted Answer

DSCR loans can close within 1031 timelines if your documentation is ready. The property income qualifies you, so exchange complexity doesn't slow approval.

Question 6

Will rising rates in 2026 kill DSCR deals?

Accepted Answer

Rate cuts are forecasted later this year, but DSCR pricing already includes investor premiums. Strong rental income still makes deals work even when rates climb.

DSCR Loans in Waterford: Finance Investment Properties with Rental Income