DSCR
On a 2-4 unit property, the whole building is deemed a short-term rental once 50% or more of its units are being used that way. That pulls the entire file into short-term rental treatment: a 60% maximum LTV, a 1.25x minimum DSCR, and six additional months of PITIA reserves. On a duplex, one unit is enough to cross the line; on a fourplex it takes two. This page shows exactly where the line falls on each building size and what it costs to cross it.
September 1, 2026
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Short-term rental income cannot be counted above 125% of the property's market rent, no matter what the property actually grosses. On a purchase there is no history path at all — market rent from the appraiser's 1007 or 1025 is used even when the property has years of booking records. This page covers where the ceiling sits in the calculation, how market rent is established for the comparison, and what it means to buy in a market where nightly rates run far ahead of lease rates.
September 1, 2026
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Our DSCR program does not permit short-term rentals in New York City. The prohibition is written into the Short-Term Rentals section of the guideline and carries no exception language. The property itself is usually still financeable on a long-term lease, at better leverage than the short-term path would have offered anyway. This page covers the rule as written, the 50% unit test that catches two-family owners, and the other New York restrictions an NYC investor should know.
September 1, 2026
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Twelve months of short-term rental operating history is the documentation standard on a DSCR refinance, evidenced either by a third-party rental history statement identifying the subject property or by 12 months of borrower bank statements showing rental deposits. Months with no rent count as zero in the average. A property owned at least 6 months but less than 12 may be considered on a single-loan variance basis, with the income calculation at our discretion. On a purchase, operating history is not used at all.
September 1, 2026
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A DSCR refinance has a specific minimum number of leased units by property type: a duplex needs two of two, a triplex two of three, a fourplex three of four, and a single-family rental its one unit. Below that count the property is classified as unoccupied for the transaction. A separate, lower set of counts applies to refinances and cash-out with a DSCR under 1.00, and occupancy is measured as of the appraisal inspection, not the closing date.
September 1, 2026
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On a purchase, a vacant rental costs you nothing — we qualify on 100% of the market rent from the appraiser's Form 1007 and the vacancy carries no leverage penalty. On a refinance it costs five points: the maximum LTV from the eligibility grid is reduced by 5% when the property does not meet the occupancy definition. That definition is a unit count, not a percentage — a duplex needs both units occupied, a fourplex needs three of four. And the snapshot is taken at the appraisal inspection, so a lease signed afterward does not undo it.
September 1, 2026
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Short-term rental income does not enter the DSCR calculation at face value. Gross monthly rent is multiplied by 80% to account for operating costs, and on a refinance the 12-month collection history is first capped at 125% of market rent. Because 125% times 80% equals 100%, the qualifying income on a short-term rental refinance can never exceed the property market rent, no matter how far above it the property actually grosses.
August 31, 2026
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No. Authorized user accounts are not allowed as an acceptable trade line on a DSCR file, so a score built on them clears the FICO test and still fails the credit-depth test. A borrower also cannot have only one credit score or less than 24 months of credit history, which is a hard eligibility stop rather than a pricing adjustment. Being an authorized user is normal and nobody did anything wrong here, but the fix is time and own-name trade lines, in that order.
August 31, 2026
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One tradeline is ineligible on a DSCR investment-property loan. Two work only if one is a satisfactory mortgage rating of at least 12 months, opened or closed, within the last 24 months, plus one additional open tradeline. Three or more require at least one line opened 24 months and two lines rated satisfactory for 12 months. Authorized user accounts and non-traditional credit do not count.
August 31, 2026
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A bankruptcy does not disqualify you from a DSCR loan on an investment property, but it starts a clock. Chapter 7, Chapter 11 and Chapter 13 each carry a 36-month waiting period on The Fiirm's DSCR program, and all of them are measured from the date of discharge or dismissal — not from the date you filed. This page covers each chapter, what a dismissed case does, how multiple filings interact with the lookback, and the documents the file needs.
August 31, 2026
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Two facts decide it: the date the forbearance was filed, and whether it ended in a modification. A forbearance filed after 6/1/2022, or any forbearance that resulted in a subsequent loan modification or repayment plan, is treated as significant derogatory credit and carries a three-year waiting period. Anything outside those two descriptions is a documentation item: exited plan, on-time payments since the exit, and a letter of explanation. A loan in active forbearance is ineligible.
August 31, 2026
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A DSCR loan on a 1-4 unit rental is available to borrowers on non-permanent status, but only on a closed list of visa classes: E-1, E-2, E-3, EB-5, G-1 through G-5, H-1, L-1, NATO, O-1, R-1 and TN NAFTA. The visa must be current, and a visa expiring within six months of the close date triggers extension documentation. This is the opposite of the commercial side, where temporary status is excluded outright. This page is about program eligibility only and is not immigration advice.
August 31, 2026
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No. A trust or LLC borrower where a power of attorney is used is named an ineligible borrower in both of our program guidelines, and the commercial guideline prohibits POAs at closing unless legal counsel approves. No exception process is described anywhere in either document. This page covers what the rule is, why it exists, what a POA does to the personal guaranty, and the mail-away, notarisation and scheduling routes investors use instead.
August 31, 2026
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Yes — if underwriting can follow the ownership up the chain and land on a natural person who will sign a guaranty. Layered holding-company structures are not automatically ineligible; structures we cannot see through to a real human being are. The usual fix is a change at the borrowing entity, not an unwind of your holding structure.
August 31, 2026
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No. On our DSCR program for 1-4 unit investment property, an irrevocable trust cannot be the borrower, and it cannot sit as a member of the borrowing LLC either. A revocable trust generally can. The reason is recourse: every loan on the program requires a natural person with control who signs a personal guaranty, and an irrevocable trust is built to sever exactly that. This page explains the look-through test, the trust-as-LLC-member case, and what an owner whose property is already in a trust can practically consider.
August 31, 2026
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A DSCR refinance becomes a cash-out refinance when the borrower receives net proceeds exceeding 10% of the loan amount. Below that line it is rate and term. The classification is computed at final underwriting, not elected on the application, which is why borrowers find out late. This page shows what counts toward the threshold, what trips a file over it, and exactly what reclassification costs in LTV, proceeds and coverage.
August 31, 2026
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On The Fiirm's DSCR program, a purchase is treated as a flip when your contract price exceeds the seller's acquisition price by more than 10% and the seller acquired the property 90 or fewer days before your contract date, or by more than 20% when they acquired it 91-180 days before. If either test is met, a second appraisal is required and seven other conditions attach. This page gives you the exact thresholds, what else the file will ask for, and how to check a rehabbed house before you sign.
August 31, 2026
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A lender adds renovation money to your cost basis only if it was a capital improvement, only if you paid for it yourself, and only if you can produce paid invoices. Demolition, debris removal, fixing lights and outlets, and carpet removal are named in the guidelines as not CAPEX. Financed work does not count — on the commercial program that prohibition is written out in so many words. And past six months on DSCR, the whole test usually stops applying.
August 31, 2026
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On a DSCR rate-and-term refinance of a 1-4 unit rental owned three to six months, value defaults to the lower of cost basis or the appraisal. If your documented cost basis is at least 120% of the purchase price, the appraised value can be used for LTV instead — with the loan amount capped at cost basis. Past six months of ownership, appraised value governs and the test does not apply. This page shows the build-up, the CAPEX exclusions, and the arithmetic both ways.
August 31, 2026
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You bought the rental with cash and want the capital back. On The Fiirm's DSCR program for 1-4 unit investment property, delayed financing does that if the purchase closed within six months of loan approval or the Note date, no financing was used, and the prior sale was arm's length. The recoverable amount is capped at purchase price plus the closing costs you paid at acquisition, not at the appraised value. It prices as a rate-and-term refinance.
August 31, 2026
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