The Overview of DSCR 2nd’s

The DSCR 2nd’s program is a stand-alone, closed-end second mortgage built for real estate investors who want to tap into their property’s equity without disturbing their existing first mortgage.

DSCR stands for Debt Service Coverage Ratio, meaning qualification is based on the rental income of the property, not the borrower’s personal income or debts. For investors sitting on significant equity but locked into a great first mortgage rate, this program provides a creative way to access capital without the need for a full refinance.

This program is strictly for refinance transactions, making it an ideal solution for investors looking to pull out cash for future investments, renovations, or business expansion.

Key Features of the DSCR 2nd’s Program

• Loan Purpose: Refinance only. Not available for purchase transactions.
• Loan Amounts: $75,000 up to $500,000.
• Loan Terms: 30-year or 20-year fixed-rate terms available.
• Interest-Only Option: Available for the first 10 years, then converts to a fully amortizing payment.
• Occupancy Type: Investment properties only.
• Stand-Alone Structure: No need to refinance the existing first lien.
• Entity Borrowing: Can close in the name of an LLC or other eligible entity.

Who is the DSCR 2nd’s Program For?

This program is ideal for:

1. Experienced Real Estate Investors

• Investors who want to access equity without disturbing low rates on their first mortgage.
• Borrowers seeking capital for renovations, new acquisitions, or other investment purposes.