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Investment Loans and the Role of DSCR: Navigating Cash Out and No-Income Documentation Options

Investment Loans and the Role of DSCR: Navigating Cash Out and No-Income Documentation Options

In the ever-evolving world of real estate financing, investors often find themselves caught in a maze of options. Two such choices that have garnered attention are the Investment Loan for Cash Out (based on the Debt Service Coverage Ratio or DSCR) and the No-Income Documentation (DSCR) loan. Both can be game changers but understanding them…

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Debt Service Coverage Ratio Mortgages

Debt Service Coverage Ratio (DSCR) mortgages are intended to help real estate investors and property owners finance their properties with flexibility and control. Traditional mortgages focus mainly on the borrower’s credit score and income, while DSCR mortgages consider the property’s cash flow to determine the borrower’s repayment ability. Based on the property’s actual income and…

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New Federal Rule Increases Payments for Homebuyers with Good Credit

Higher mortgage rates and fees are now increased for homebuyers with good credit ratings thanks to a novel governmental rule to subsidize other potential homebuyers with lower credit scores. As part of the Federal Housing Finance Agency’s push toward affordable housing, the fees will affect mortgages secured in private banks across the United States.  Homebuyers…

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2023 Housing Market Predictions

The housing market is being eyed with heavy suspicion and uncertainty as rising interest rates combined with an unstable housing market and an increase in median sales prices. With the new year comes new questions pertaining to costs, sales, and more. Home values in Michigan have risen by roughly 32 percent in the past two…

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Home Equity Basics

By owning your own home, equity allows you to build wealth through time. Homeowners are responsible for maintaining the house after the mortgage closes, but it’s not for nothing. Home equity builds with each payment made towards your mortgage and the value of comparable sales in your neighborhood. Home equity is the value of your…

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Home Equity Statistics

Home equity is a hot topic lately, especially since home prices have escalated recently. In the second quarter of 2022, the average level of equity for homeowners with mortgages reached almost $300,000. Over the past five years, home equity has been skyrocketing, spurred into overdrive by the pandemic.  According to the National Association of Realtors,…

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What is a Reverse Mortgage

Reverse mortgages are specially designed for homeowners 62, and older looking to supplement their income, cover healthcare expenses, etc., by converting part of their home equity into cash. The homeowner retains the title and gets an advance on some of the home equity in lieu of paying monthly mortgage payments. While this may be enticing for…

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Federal Reserve Raises Interest Rates for First Time Since 2018 to Combat Inflation

In March, interest rates were increased – with six more increases scheduled before year end – marking the most aggressive pace in over 15 years. The Federal Reserve hopes to thwart rising inflation, which is at its highest levels in four decades. Rising to a point between .25 percent and .5 percent, the benchmark federal-funds…

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Home Prices Rise Fastest in Four Decades

Prices for homes have been rising for a while now, and a new report indicates that they have been growing fastest since the past four decades. CoreLogic released a new report that outlines how home prices have risen by 18 percent from October 2020 to October 2021. The Federal Housing Finance Agency House Price Index…

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Rental History Will Soon Factor into Mortgages

Fannie Mae plans to launch a new underwriting innovation beginning September 18, 2021 that will automatically incorporate rental history into their credit evaluation system. Using bank statement data, mortgage lenders will be able to “deliver a more inclusive credit assessment” with the borrower’s permission, according to the press release. Hugh R. Frater, Fannie Mae CEO,…

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