A no-ratio loan is a specialized product where the lender does not require the rental income to exceed the mortgage payment (a DSCR of less than 1.0). This is ideal for properties undergoing a "turnaround" or short-term rentals that have high potential but low current documented income. The formula is DSCR = Net Operating Income (NOI) / Total Debt Service (PITIA)

Yes! Many first-time investors believe they need a long history of property management to qualify for specialized financing, but that isn't the case. At NEXA Mortgage, we offer DSCR (Debt Service Coverage Ratio) programs that focus on the cash flow of the property rather than your personal employment history or years of experience. As long as the rental income covers the mortgage payment (PITIA), you can secure financing for your very first investment.

The primary benefit is flexibility. Unlike traditional loans, DSCR loans do not require tax returns, W-2s, or debt-to-income (DTI) calculations. This is a game-changer for self-employed investors or those looking to scale their portfolios quickly. Since the loan is based on the property's performance, it allows you to grow without being limited by your personal income.

Absolutely. Whether you are looking at a multifamily complex in Texas, a retail space in Florida, or a short-term rental in Tennessee, we provide nationwide financing solutions. Our team understands the nuances of different markets across the U.S., ensuring you get the best commercial terms regardless of where your target property is located.

***Offering DSCR & commercial loans in only these states or territories currently: AL, AK, AR, CO, CT, DE, FL, HI, IL, IN, IA, KS, KY, ME, MI, MS, MO, MT, NE, NH, NM, NC, OK, OH, PA, SC, RI, TX, TN, VA, WA, WV, WI, WY, District of Columbia, Puerto Rico, US Virgin Islands

Yes, and we often recommend it. Most commercial and DSCR loan programs allow—and sometimes require—you to close in the name of an LLC or business entity. This provides an added layer of liability protection for you as an investor. If you are a first-time investor and haven't set up an entity yet, we can guide you through how this impacts your loan application.

For most DSCR and commercial investment loans, you can expect a down payment ranging from 15% to 25%. While this is higher than a primary residence, the trade-off is a much faster closing time and fewer "hoops" to jump through regarding your personal finances. We also offer "no-ratio" options for properties with unique potential that may not yet be fully occupied.

Absolutely. DSCR loans are perfect for vacation rentals. We can often use data from platforms like AirDNA or the property’s actual rental history to project income, allowing you to qualify even if the property is currently vacant.

Most DSCR loans come with a prepayment penalty (often a 3-2-1 or 5-4-3-2-1 structure). This means if you refinance or sell within the first few years, you pay a small percentage. However, we offer "buy-down" options to reduce or eliminate these penalties if you plan to flip or refi quickly.

Unlike conventional loans, which usually cap you at 10 properties, there is often no limit to the number of DSCR loans you can hold. This makes them the primary tool for investors looking to scale a massive nationwide portfolio.

Since these are "business-purpose" loans closed in an LLC, they typically do not report to your personal credit bureaus. This keeps your Debt-to-Income (DTI) ratio low for other personal purchases like a primary residence or a new car.

In the lending world, any residential building with 5 or more units is considered commercial. These properties are valued based on their Net Operating Income (NOI) rather than comparable sales, which is where specialized commercial financing becomes necessary.

Yes. If your property has a retail storefront on the bottom and apartments on top, it qualifies for mixed-use financing. We look at the combined income of both the commercial and residential units to determine the loan amount.

While requirements vary, most competitive commercial programs look for a score of 660 or higher. However, if the property's cash flow is exceptionally strong, there are often workarounds for lower credit scores. We do have a few DSCR programs for borrowers with a credit score as low as a 600, but these deals include an increase in points and closing costs.

Yes. Cash-out refinances are a popular way to "recycle" equity. You can use the cash from one property’s appreciation to fund the down payment on your next nationwide investment. In some instances, you can also use cash out for reserves.

Most DSCR and commercial loans are "recourse," meaning a personal guarantee is required. However, for larger commercial deals or specific portfolios, we can explore non-recourse options where the lender’s only collateral is the property itself.

Lenders want to see that you have "liquid" cash left over after closing (usually 3–6 months of mortgage payments). This ensures you can handle a vacancy or a repair without defaulting on the loan.

BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat. Our DSCR loans are the "Refinance" engine of this strategy. Once you’ve renovated a property and placed a tenant, we use a DSCR loan to pay off your hard money and pull your initial capital back out.

To maximize monthly cash flow, many investors choose an Interest-Only (IO) period for the first 10 years of the loan. This lowers your monthly payment significantly, though you won't be paying down the principal balance during that time.

Yes. We frequently work with 1031 Exchange accommodators. This allows you to sell a property and "roll" the capital gains into a new investment property through our DSCR or commercial programs without paying immediate taxes. This is a primary strategy for nationwide investors looking to "level up" their portfolios. The only caveat is that some DSCR programs do not allow you to use subordinate financing when a 1031 exchange is involved, so be sure to ask.

Yes, we have specific programs that allow for gift funds. While it is true that most traditional DSCR and commercial lenders strictly require the down payment to be the investor’s own seasoned funds, we offer flexible solutions for those receiving assistance from family or business partners. Whether you are using gift funds, "gap funding," or capital from a joint venture partner, we can help you structure the deal to meet lender requirements. We will review your specific asset structure and the source of your funds to ensure you qualify for the best possible rate.