Real Estate Investor Loan FAQ
Looking for fast and flexible financing as a real estate investor? Our FAQ answers the most common questions about hard money, DSCR, bridge, and construction loans. These insights help investors, landlords, and developers understand how to access funding quickly, without the roadblocks of traditional banks.
What is a hard money loan?
A hard money loan is a short-term, asset-based loan primarily used by real estate investors. Approval is based on the property’s value rather than the borrower’s income, making it a great option for house flippers and landlords who need fast funding.
What is a DSCR loan?
A DSCR loan (Debt Service Coverage Ratio) qualifies you based on rental income rather than your personal income. Lenders look at whether the property’s rent covers the mortgage, taxes, and insurance. This makes it easier for investors to scale their rental portfolios without W-2 requirements.
What is the difference between a DSCR loan and a traditional mortgage?
Traditional mortgages require W-2 income, tax returns, and personal debt-to-income ratios. DSCR loans, on the other hand, only require rental income and an appraisal, allowing investors to qualify faster and purchase more properties under an LLC or INC structure.
What is a bridge loan in real estate?
A bridge loan provides short-term financing to help investors buy a property before selling another one. It’s a useful tool when timing is critical, such as securing a deal quickly or closing while waiting for a property sale.
What is a Ground Up Construction Loan?
Ground Up Construction loans provide funding for building new properties or major renovations. These loans are typically short-term and release funds in stages based on project milestones. They are essential for ground-up builders and large rehab projects.
Do I need income verification for these loans?
No. One of the biggest advantages of Quick Real Estate Funding, nationwide private money lender is that they do not require traditional income verification. They focus on the property’s value or rental income, not your paystubs or tax returns.
How fast can I close with Quick Real Estate Funding?
Many loans can close in 5–10 business days, compared to 35–60 days with a bank. Speed is one of the biggest advantages for investors competing in a hot real estate market.
What credit score is needed for a hard money loan?
Credit requirements are more flexible than traditional loans. Some programs accept scores as low as 650, while higher scores may qualify for better rates and higher LTV(loan to value). Property value and equity are more important factors.
What credit score is needed for a DSCR loan?
Most DSCR loan programs require a minimum FICO score of 660–680. A stronger score can help reduce rates and improve terms, but these loans are still more flexible than conventional mortgages.
Can I use a DSCR loan for short-term rentals (Airbnb/VRBO)?
Yes. Many DSCR lenders allow short-term rental income to qualify as long as it is supported by a rental analysis report or comparable market rents. This makes DSCR loans attractive for Airbnb and vacation rental investors.
How much can I borrow with a hard money loan?
Hard money loans can go up to 75% of the property’s after-repair value (ARV). Loan amounts typically range from $75,000 to several million, depending on the project size.
How much can I borrow with a DSCR loan?
DSCR loans can finance properties up to $2–5 million, sometimes more. The main factor is whether the property’s rental income meets the required DSCR ratio, usually around 1.10 or higher.