New Jersey DSCR Loan Lenders for Long-Term Rental Homes
Are you seeking long-term private financing for a residential rental property in New Jersey? On this page you'll find a list of lenders that offer these “DSCR” loans for single family homes, condos, and 2-4 unit rental properties in New Jersey’s urban areas. Some lenders consider vacation rentals (aka short-term rental or STR). The maximum loan-to-value is 80%. For a purchase, investors need a minimum down payment of 20%, and it could be higher depending on the debt service coverage ratio (DSCR), borrower’s credit score and location. The minimum credit score is 680 for most lenders. The loans terms range from 5 to 30 years.Searching...
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New Jersey DSCR Loan Interest Rates
According to the loan documents software company, Lightning Docs, the average interest rate for New Jersey DSCR long-term rental loans in the 1st quarter of 2024 was 8.00%. The average loan amount was $430,344. These stats are the average of 250 loans funded for residential rental properties in New Jersey between January 1, 2024 and March 31, 2024 by multiple lenders that use Lightning Docs as their preferred software provider to prepare loan documents.
Funded DSCR Rental Loans in New Jersey
RCN Capital, a national direct private lender, funded a $224,250 DSCR refinance loan for an SFR long-term rental in Willingboro, NJ. The property value was appraised at $345,000 so our loan-to-value was 65%. We paid off a previous loan balance of $200,200 and provided some cash-out. The property was receiving a monthly rent of $2,600 which was $250 below the market rates per the appraiser’s estimate ($2,850). The 1,684-square-foot subject property was in excellent condition and tenant-occupied at closing. The Borrower had excellent credit with a mid-score of 752 and bank statements that reflected sufficient funds to meet our reserve requirement. The loan was structured and priced in accordance with our qualification model. The DSCR was 1.19. The interest rate was fixed at 7.15% with amortized payments, and we charged 4% origination points. The loan term was set at 30 years. This DSCR refinance loan was funded in December 2023.
RCN Capital, a national direct private lender, funded a $373,193 1st lien position long-term rental loan for the acquisition of a 2-unit rental property in Brigantine, New Jersey. We funded 51% of the $663,000 purchase price, while the Borrower contributed 49% cash at closing. The Borrower is an experienced investor (self-employed). The duplex is eligible to get monthly market rates as per the appraiser’s estimate of $3,600/Month. The major Sponsor on the loan had excellent credit with a mid-score of 773 and bank statements that reflected sufficient liquidity to close the deal. The loan was structured and priced in accordance with the qualification model. The total loan amount is 50.8% loan-to-value and 56.3% loan-to-cost with a 1.10 DSCR. The subject property, located in a vacation area, was in excellent condition and is approximately 1,884 square feet. The interest rate was fixed at 7.14% with amortized payments, and we charged 1.5% origination points. The loan term was set at 30 years. This DSCR long-term rental loan was funded in August 2023.
RCN Capital, a national direct private lender, funded a $345,600 1st lien position long-term rental loan for the acquisition of a 3-unit residential investment property in Rahway, New Jersey. We funded 69% of the $432,000 purchase price, while the Borrower contributed 31% cash at closing. The subject property was being leased for $5,533 per month which was above market rate per the appraiser’s estimate of $4,300. It was appraised for $500,000 As-Is and Collateral Desktop Analysis confirmed the value was acceptable. The Sponsor had a mid-score of 766 and bank statements that reflected sufficient liquidity. The loan was structured and priced in accordance with the qualification model. The total loan amount was 80% loan-to-cost and 69.12% loan-to-value with a 1.29 DSCR. The Borrower plans to hold the property as a long-term rental. The subject property was in good condition. It was is approximately 1,872 square feet. The interest rate was fixed at 7.48% with amortized payments and we charged 3% origination points. The loan term was set at 30 years. This DSCR loan was funded in May 2023.