Managing financing for multiple rental properties can be a major headache. That's where DSCR Portfolio Loans come in – they are specifically designed for real estate investors who own multiple income-generating properties (typically 5 or more, but sometimes fewer).
Instead of looking at your personal W2 income or tax returns like traditional mortgages, these loans focus solely on the cash flow generated by your entire rental portfolio. The key metric is the Debt Service Coverage Ratio (DSCR), which compares the portfolio's total rental income to its total debt obligations (including principal, interest, taxes, insurance - PITI).
Formula: DSCR = Portfolio's Gross Rental Income / Portfolio's Total Annual Debt Service (PITI)
If your properties collectively generate enough income to cover their combined mortgage payments (typically requiring a DSCR of 1.0x to 1.25x or higher), you can qualify – often with less paperwork and faster approvals than traditional methods.
Consolidating your rental property financing offers several advantages:
💡 Khojie Advantage: We streamline the portfolio loan process. Instead of applying separately to multiple banks for each property (which takes months!), Khojie connects you with specialized portfolio lenders for faster, more efficient financing.
Here's how financing a portfolio typically works:
Lenders look for experienced investors with cash-flowing portfolios:
This varies by lender, but typically lenders look for portfolios with 5 or more properties. However, some programs may consider smaller portfolios, especially for experienced investors. Khojie can help find lenders matching your portfolio size.
Lenders calculate the aggregate DSCR by dividing the total gross rental income from all properties in the portfolio by the total annual debt service (PITI) for all properties included in the loan. Stronger properties can help offset weaker ones.
Yes, cash-out refinancing is a common use for DSCR portfolio loans. Investors often use this strategy to pull equity from their portfolio to fund repairs, acquire additional properties, or for other investment purposes.
Rates can vary. Sometimes, bundling properties might secure a slightly better rate than individual loans, especially for strong portfolios. Other times, the complexity might lead to slightly higher rates. Khojie helps you compare offers to find the most competitive terms.
Stop juggling multiple mortgages. Unlock the power of your portfolio's cash flow with a DSCR Portfolio Loan arranged through Khojie.
