Hudson group realty network specializes in “DSCR” loans. All our loans are based upon the Debt Service Coverage Ratio-“the DSCR” I am going to simplify it, you take the mortgage principal and interest. The taxes on the property and the Homeowners insurance. (You take those tax and HOI numbers and divide by 12 to give us the per month)
So let’s say my mortgage payment (for principal and interest) is 1,000.00, the taxes and insurance on the property are (taxes) 5,000.00 and (Insurance) 2,000 yearly.
You take the 7,000.00 total and divide by 12 (for months in the year) =583.33
So 1,000 plus 583.33= 1,583.33 a month.
The house that you are looking to buy, is a 2 family and you collect 1,000 on the first floor and 1,000 on the second floor. So that’s 2,000.00 a month.
Your house would qualify for the loan! As long as the rents cover the payment of the mortgage. (in this instance, the mortgage payment could go up to 2,000 a month and it would qualify)
The maximum loan to value (LTV is loan amount compared to value) If house is worth 200k and need loan amount of 160,000.00 that would be 80% LTV (which is our maximum Loan to value)
To qualify for this loan, you would need 3 things:
- Credit of 680 or above
- Bank statements for the last 60 days showing you have the down payment and closing costs (with no large cash deposits in them)
- A positive attitude!
Hope this helps explain our most popular program at HGRN! Happy shopping