Popular New Arizona Rental Loans

Popular New Arizona Rental Loans | Valor Lending Group

Are you interested in learning about our popular new ARIZONA Rental Loans?

In today’s market, the popularity of rental property loans is skyrocketing!

Rental Loans help real estate investors buy and hold for rental income or fix and flip for a quick profit.

Valor Lending Group is serving up Arizona and California with the top rental loans around!

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What is Debt Service Coverage Ratio (DSCR)?

The DSCR = Properties Current Rents / New PITI (principal, interest, taxes, and insurance) monthly Payment. If your property is collecting rents that covers your current PITI Payment your property debt services aka your property’s rents cover your total mortgage payment.

Example of DSCR Calculation: New P&I = $1,851.26 + 758.53 taxes + $147 insurance = $2,756.79 PITI | $3200 Current Rents/$2756.79 = 1.16 DSCR

Debt service coverage ratio (DSCR) is one of many financial ratios that lenders assess when considering a loan application. This ratio is especially important because the result gives some indication to the lender of whether you’ll be able to pay back the loan with interest. A ratio over 1 is good, and the higher the better.

The minimum DSCR a lender will demand depends on macroeconomic conditions. If the economy is growing, lenders may be more forgiving of lower qualifying ratios.

Here’s how to interpret your DSCR:

• DSCR < 1: You have negative cash flow. You don’t have enough rental income to service the debt (New PITI payment).
• DSCR = 1: You have exactly enough rental coming in to service the debt (New PITI payment), but you don’t have an additional cash cushion.
• DSCR > 1: You have positive cash flow. The higher your DSCR, the more income you have to service the debt (New PITI payment).

DSCR – Example

For example, assume an investment property is rented for $2,000/month. Assume also the property has the following monthly expenses.

Principal & Interest                  $1,000/mo

Property Taxes                         $250/mo

Insurance                                  $120/mo

HOA Dues                                 $130/mo

TOTAL PITIA                            $1,500/mo

In this example, the DSCR = $2,000 Monthly Rent / $1,500 Monthly PITIA = 1.33.

No-tax-return investment property lenders generally want to see DSCR above 1.00, and sometimes offer better pricing if the DSCR is above 1.25-1.50.

Advantages & Disadvantages

1) Pros of No-Tax-Return Investment Property Loans

• No tax returns required
• No employment or income required
• Personal or business income not considered
• No debt-to-income (DTI) ratio developed or considered
• Allows real estate investors and self-employed individuals to qualify when they otherwise cannot

2) Cons of No-Tax-Return Investment Property Loans

• Larger down payment than traditional loans
• Rates are slightly higher than traditional loans (but not much more)
• Some (but not all) lenders require landlord experience
• Personal credit still plays a role

Rental Property Loan Highlights:

• No Tax Returns
• Employment NOT Required
• No Income Required
• No Debt to Income Ratio Calculated
• Cash Flow based on Subject Property rents | If property is vacant upon purchase market rents from the appraisal will be used to calculate DSCR
• SFR, Condo and 1-4 Unit
• Maximum Loan $2.5M | Purchase and R/T Refinance
• Maximum Loan $2M | Cash out Refinance
• Unlimited Financed Properties OK

Don’t let a rising-rate environment prevent you from acquiring more investment properties!

We also have solutions to access capital through a refinance with a rate that will let your properties cash flow.

CONTACT ME TODAY for immediate attention to your scenario 

Recap of our Loan Products:

1. Hard Money Loans (20% down / minimal documentation) Typically Fund in 7-10 days.
2. Stated Income Loans (Great for business owners and self employed ) No tax returns!
3. 100% financing is available (we can cross collateralize other properties if there is enough equity)
4. Valor VA Home Loan 100% financing up to $1.5MM
5. Rental Property Loan – No tax returns or DTI calculation! Based on subject property cash flow – No DSCR Coverage needed!
6. Flipper & Rehab Loans (Flip a property with one of our many options)
7. 2nd Position Loans up to $5mm
8. Raw Land & Lot Loans
9. Ground up Construction for spec homes, custom homes and commercial ground up.
10. Farms, Vineyards, Ranches and Agricultural Properties (25-30% down)
11. 5% down Jumbo’s with NO MI up to $2mm / 10% down up to $3mm
12. Manufactured Housing / Mobile Homes (20% down / 600+ credit score)
13. Acreage Properties
14. Commercial Loans up to $500mm
15. 3% & 5% down Conventional Loans– LPMI (Lender paid mortgage insurance)
16. Foreign Nationals Loans (no social security or residency required)

We Also Offer

1. Conventional Conforming Loans (under $510,400)
2. High Balance Conforming (from $510,400-$765,600)
3. Jumbo Loan Financing to $10 Million / Super low rates! / 10% down Jumbo to $3mm
4. FHA, USDA
5. Reverse mortgages up to $1 Million Value
6. Cash Out Refinancing

CONTACT ME TODAY for immediate attention to your scenario! 

**Rates and terms subject to change without notice**

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