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    Griffin Funding offers Investment Property Loans, or DSCR loans. A DSCR loan is a type of non-QM loan for new or seasoned real estate investors. With this particular program, no income or tax return verification is required. You can easily qualify based on the property’s cash flow. As a real estate investor, you can avoid high rates and high points of private hard money loans, and lengthy approval processes.

     

    The Debt Service Coverage Ratio is a ratio of a property’s annual gross rental income and its annual mortgage debt, including principal,interest, taxes, insurance and HOA (if applicable). Lenders use gross rental income instead of net operating income to calculate DSCR to qualify. Griffin Funding analyzes how much of a loan can be supported by the income coming from the property as well to determine how much income coverage there will be at a specific loan amount.

    Example of Debt Service Coverage Ratio Calculation:

    A real estate investor might be looking at a property with a gross rental income of $50,000 and an annual debt of $40,000. When you divide $50,000 by $40,000, you get a DSCR of 1.25. This means that the property generates 25% more income than what is necessary to repay the loan. This also means that there is a positive cash flow in the lender’s eye.

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    Here are a few reasons to start or continue to invest in real estate:

    Leverage of Other People’s Money (OPM). You don’t need to be a millionaire or have hundreds of thousands in the bank to invest in a real estate investment property. If you pay 20% down, a bank or lending institution will provide the rest of the funding.

    Cash flow. This is the monthly profit you make after all expenses associated with the property. It’s an ongoing stream of residual income if your property is purchased and managed properly. Now just imagine if you used a cash-out refinance on your first property to purchase a second property? You could continue this trend and continue to purchase properties, with cash from your original investments to purchase more income producing properties. We call this “The Property Multiplier Effect”.

    Appreciation and Tax advantages. Even though this particular program is geared towards long term investment goals, if the value of your property has gone up and you decide to sell, the appreciation is your profit. Tax credits are available for low-income housing, the rehabilitation of historical buildings, and certain other real estate investments. Tax credits are deducted directly from the tax you owe. You also get an annual deduction for depreciation, which is typically a percentage of the value of the property that you can write off as an expense against revenues. We recommend using a CPA to understand the potential tax benefits from owning investment properties

    Fewer highs and lows than the stock market. See our recent blog post about Investing in Real Estate vs. the stock market HERE.

    Apply for Non-QM Investment Property Loan

    Begin or continue building your real estate investment portfolio without the need for a private loan. Our DSCR loans are an excellent mortgage option for new and seasoned investors to help you build your portfolio without mortgage challenges standing in your way. Apply for a DSCR loan online today.

    Want to learn more about our non-QM loans before applying? Contact us online or call us at (855) 394-8288 to speak to one of our experienced loan specialists.

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    Bill Lyons

    Bill Lyons is the Founder, CEO & President of Griffin Funding. Founded in 2013, Griffin Funding is a national boutique mortgage lender focusing on delivering 5-star service to its clients. Mr. Lyons has 22 years of experience in the mortgage business. Lyons is seen as an industry leader and expert in real estate finance. Lyons has been featured in Forbes, Inc., Wall Street Journal, HousingWire, and more. As a member of the Mortgage Bankers Association, Lyons is able to keep up with important changes in the industry to deliver the most value to Griffin's clients. Under Lyons' leadership, Griffin Funding has made the Inc. 5000 fastest-growing companies list five times in its 10 years in business.