What are lender requirements for cash reserves when applying for a DSCR loan?
Some lenders may require borrowers to have a certain amount of cash reserves when applying for a DSCR loan. These reserves act as a financial cushion to cover potential vacancies, unexpected repairs, or other unforeseen expenses related to the property[2].
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Related Questions
What is a DSCR loan?
A DSCR loan, or Debt Service Coverage Ratio loan, is a type of mortgage designed for real estate investors. Unlike tradi...
How is the DSCR calculated?
The DSCR is calculated by dividing the property's net operating income (NOI) by its annual debt service (total principal...
What is a good DSCR ratio?
Lenders typically prefer a DSCR of 1.25 or higher, indicating the property generates 25% more income than needed for deb...