A hard-money loan has a very short repayment period—almost always less than two years—and high interest rates. Many times, a hard-money lender will allow interest-only payments, but a DSCR lender will not. While DSCR loan rates are higher than for other loans, the term is similar to ...
When applying for a DSCR loan, several unexpected elements or surprises may arise that you should be aware of, such as: Prepayment Penalties Prepayment penaltiesare fees lenders charge if you pay off your loan earlier than the agreed-upon term by either selling the home or refinancing the loan...
The DSCR is also a more comprehensive analytical technique when assessing the long-term financial health of a company. The DSCR is a more conservative, broad calculation compared to the interest coverage ratio. The DSCR is also an annualized ratio that often represents a moving 12-month period....
Fix and flip loans are designed to be short-term, with the entire principal due when you sell the property or reach the end of the loan term. Most flippers plan to sell their renovated property well before the loan matures, using the sale proceeds to repay the loan. If you can’t sell...