DSCR loans require turnkey, livable properties certified by an appraiser. Properties needing visible rehab must start with a fix-and-flip loan, then refinance into DSCR once work is done. Around $30,000 in repairs might still qualify as livable depending on the appraisal.
If we find a property that's not ready, it's not turnkey and it needs some improvements, how would you add that?
Well, you wouldn't be able to get a DSCR loan because a DSCR loan is turnkey loan. You can't have any rehab on it. So when you get an appraiser appraisal, it has to state that it's, you know, certified livable condition. It can, you know, I've seen properties get appraised that it honest, honestly need like $30,000 worth of rehab work to be considered like what I would call an attractive listing or something that people would want to stay at. But it's still livable, right? So it all depends, you know, if it's ripped down to the studs, that's not livable. So it really comes down to the appraisal. If it's not a turnkey property and does require visible rehab that in its current condition is not livable, then you're looking at a fix and flip loan. You'll have to wait till you do the rehab and then refinance out of that fix and flip load into your long term DSCR loan.
