The 6 Most Popular DSCR Loan Lenders in New York

New York, The Empire State, is the 4th most populous state in the US with a population of $20.2 million residents. Most of this population is concentrated in New York City, 8.8 million in fact. New York City is one of the largest megacities in the world and a titan of American culture, finance, and technology. Tourists heading to The Big Apple or to upstate New York spent $73.6 billion dollars in 2019. Those numbers have dropped off since the Pandemic, but are expected to recover soon. 

Real estate has always been a hot commodity in New York. The median sold house price for July 2022 was $420,000, a 9% increase from last year according to the New York association of realtors. About 64% of New Yorkers own their homes compared to 36% who rent according to the Housing Vacancies and Homeownership from the US Census. Of those rentals 11% are empty. If you look to New York City however these numbers go quite a bit higher. Median house prices in NYC hit $1.1 million in 2020. The number of renters is much higher in the Big Apple compared to New York State, with 67.2% of residents being rentees. 

High demand for housing in New York appears to be only increasing, meaning there is always room for real estate investors to start building a portfolio in the Empire State.

How DSCR loans work

Lenders think DSCR loans “work” because they use the investment property’s profits to cover the loan’s mortgage payment. This works by calculating the Debt Service Coverage Ratio, or DSCR. Borrowers will take the potential profits from the rental income and divide it by the debts, including the loan repayments. A positive cash flow ratio will be a result of 1.0 or greater and shows that the borrower can repay the loan using rental income.

Lenders find these loans attractive hard money loans because it widens the potential pool of investors. Since DSCR mortgage loans only take into account rental income it means entities like foreign nationals or borrowers with home businesses that wouldn’t qualify for a traditional mortgage can apply (such as they can’t prove 2 years of business). LLCs are also available for DSCR loans, something that can be difficult to do in a conventional mortgage property loan.  

Top 6 most popular New York DSCR loan lenders

If you’re ready to learn more about the best DSCR lenders in New York, here are the top options we’ve found through our research.

1. Mortgage Shop

Mortgage Shop is a hard money lender specializing in DSCR mortgage loans that was started by Brenna Carles and Avery Carl. Mainly focusing on the East Coast, they have rapidly expanded to parts of the South and Midwest. They have experience working with vacation homes and both short-term and long-term rentals.

We reached out to the Mortgage Shop to get more information about their DSCR loan program and here are some highlights:

• No personal income/no employment is needed
• No DTI required
• Mortgage borrowers can own an unlimited amount of properties
• Use only the market rents from the appraisal to qualify the loan
• Minimum DSCR 1.00 – No DSCR needed with minimum 700 FICO and max 75% LTV
• Credit score down to 680
• LTVs up to 80%
• Interest-only available

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

2. LBC Mortgage

LBC Mortgage traces its roots back to 2008 and has a history in the real estate mortgage space. They provide a wide range of financial products, including DSCR loans.

We contacted LBC Mortgage to learn more about their DSCR program and here are the highlights:

• No requirement to verify employment or income history.
• Able to work with new and experienced investors.
• Can handle short-term or long-term rentals.
• Loan amounts up to $5 million available.
• Requires 6 months of reserves (unless cashout refinance, then no reserve requirement).
• Unlimited number of properties.
• Down payment minimum of 20% required.

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

3. MortgageDepot

Like many mortgage brokers, MortgageDepot offers access to a wide range of non-QM financial products, including stated income loans, asset-backed loans and no-income loans. They also offer access to commercial loans, so could be useful if you need to finance a commercial property.

We contacted MortgageDepot to learn more specifically about the DSCR loans that they offer and here is what we found:

• No income or employment verification is required.
• Loan amounts of up to $3 million.
• 30- and 40-year fixed-rate mortgages, as well as 5/6 and 7/6 adjustable-rate mortgages (ARMs).
• Minimum credit score of 599 required
• Combined loan-to-value ratio (CLTV) of up to 85%.
• DSCR calculations as low as zero are eligible for the program.
• Borrowers must have owned any property type in the past 24 months to qualify.
• Non-permanent residents and foreign nationals are eligible.
• Condotel purchases are eligible.
• Borrowers may use cash-out funds for reserves.

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

4. LendSure

Headquartered in San Diego, LendSure Mortgage Corp. was founded in 2015 and offers many non-QM loan programs such as bank statement mortgages, foreign national lending and property investment loans, including a debt service coverage ratio loan.

We reached out to LendSure to get more details about its DSCR loan program and here are some features:

• 80% LTV for purchase and refinancing
• 70% LTV for cash-out refinancing
• Available for 5-8 unit properties with LTV up to 70%
• Loan amounts up to $1,500,000
• Cash-out refinancing up to $500,000
• Close multiple loans for the same investor at the same time
• No limit on the number of properties owned and can finance up to 10 properties for 1 investor
• Non-Warrantable condos and Condotels allowed (up to 70% LTV)
• FICO as low as 640
• Rate buy-down available

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

5. CoreVest

CoreVest started in 2014 and offers a full-range of products for residential real estate investors. According to its website, they have closed more than $20 billion in loans and lends in all 50 states.

We contacted CoreVest to get more details about its DSCR loan and here is what we could find:

• 5+ rental properties eligible
• Single-family, condo, townhome, multifamily properties are OK
• Stabilized (90% leased) portfolio
• Can lend up to 75% of value
• 3, 5, 7 or 10 year fixed loan options
• Purchase or refinance
• Non-recourse options available
• Foreign nationals eligible

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

6. New Silver

New Silver started in 2019 by Kirill Bensenoff and Alex Shvayetsky. They offer a variety of private money lending products like fix and flip, rental, ground up and personal loans.

We contacted New Silver Lending to learn more about their private lending business and here are some of the highlights:

• Origination fee from 1.875%
• Loan to cost up to 90%
• 100% construction financing available
• Loan to ARV up to 80%
• Terms are typically 24 months
• Loan amounts are from $100,000 to $5 million
• Minimum FICO score is 650
• No hard credit pull required

When you’re ready to connect with a loan officer, use our form to quickly match with eligible loan programs based on your specific circumstances.

What are the main advantages of a New York DSCR loan?

Does a DSCR loan seem right for your real estate portfolio? What are your long-term goals for this real estate investment and what are the potential shortcomings? If you are a self-employed investor with a poor credit score or little start-up capital, DSCR loans may make sense for you. While DSCR loan terms are harsh for those with bad credit and they typically have high interest rates and low borrowing limits, they may be the only loan option in New York available to a property investor. Additionally, these loans are for property which take years to fully purchase and develop. If your portfolio needs to be flexible then real-estate investment may not work for you.

For investors with good credit who are willing to invest their funds into real estate, DSCR loans can work well in New York. Both New York city and upstate New York are popular tourist destinations which means your DSCR loan can tap into the $73 billion dollar tourist industry to fund your investment. High property values and a large population also mean that long-term renting in New York makes for a promising venture.

DSCR loans can be used for more than one property and properties with multiple dwellings. Your investment can be centralized in one New York home, an apartment complex in New York City, or multiple property types across the State.

Since DSCR loans do not require income checks or W2s they are approved within a couple of weeks, rather than the months-long process of a mortgage. Borrowers have a bevy of options available for loan repayment, but the most common are interest-only, fixed-rate, or adjustable rate loans. Whatever your needs may be there is likely a loan that fits your investment needs.

If you’re looking to explore hard money in other states, check out our national overview of DSCR loans as a starting point in your search.

Joshua Holt is a licensed mortgage loan originator (NMLS #2306824) and founder of Biglaw Investor. His mortgage expertise lies in the areas of professional mortgage loans, particularly for lawyers, doctors and other high-income professionals. Prior to Biglaw Investor, Josh practiced private equity mergers & acquisition law for one of the largest law firms in the country.