The Situation
An investor with 3 rental properties wanted to buy #4 but hit a wall. His DTI on paper was already maxed from the existing mortgages. Traditional lenders said no — too much debt relative to his W-2 income, even though his rentals were cash-flowing $2,800/month profit.
What Programs Were Available?
After reviewing their full financial picture, here's what they qualified for:
- Conventional: Min credit 620, 3% min down, PMI required
- Bank_Statement: Min credit 660, 10% min down, no PMI
- DSCR: Min credit 680, 20% min down, no PMI
How We Solved It
Traditional loans look at YOUR income vs. YOUR debt. That breaks down for investors with multiple properties. So we used a DSCR (Debt Service Coverage Ratio) loan.
DSCR loans qualify based on the PROPERTY's income, not yours. The target rental: $2,400/month rent vs. $1,900/month PITIA = 1.26 DSCR ratio (above the 1.0 minimum).
We closed in an LLC for asset protection. 25% down ($100K on a $400K property), no personal income verification at all.
The Result
Property #4 acquired. Cash flows $500/month after all expenses. Tenant in place within 3 weeks of closing.
Key Takeaway
If you're an investor, stop trying to squeeze rental properties through conventional loans. DSCR is purpose-built for this: the property qualifies itself. No tax returns, no income docs, close in an LLC.
Think You Might Be in a Similar Situation?
Every borrower's scenario is different, but the process is the same: we look at your full picture, find the right program, and create a plan. Whether it's credit repair, down payment assistance, or a specialized loan program — there's usually a path.
Schedule a free consultation to see what you qualify for. No obligation, no pressure — just honest answers about your options.
Contact Aditya Choksi | NMLS #2055084 | (949) 478-7641
This scenario is based on a real borrower situation. Names, exact figures, and identifying details have been changed to protect privacy. Your qualification depends on your specific financial situation.