DSCR Loan Iowa

Last updated: December 9, 2024

What areas in Iowa are growing?

Iowa's rental market shows signs of continued growth, driven by a strong job market with diverse opportunities in agriculture, manufacturing, healthcare, and insurance, limited housing supply putting upward pressure on rents, particularly for single-family homes, and increased affordability compared to national averages.

1. Des Moines Metro:

The Des Moines Metro area is experiencing moderate population growth, with an estimated 15,000 new residents expected in the next 5 years. Major economic drivers include state government, insurance (multiple major companies), and healthcare (MercyOne Des Moines).

• 50313 (Downtown Des Moines): Revitalized downtown with job opportunities and entertainment options. Major employers include Wells Fargo, Principal Financial Group, and Nationwide Insurance. Rents could potentially increase by 4-6% annually due to growing demand from young professionals.
• 50322 (West Des Moines): Upscale suburban area with excellent schools. Major employers nearby include insurance companies and healthcare facilities. Rents could potentially increase by 3-5% annually due to limited availability and steady demand from families.
• 50266 (Urbandale): Family-friendly suburb with a mix of young professionals and families. Major employers include healthcare facilities and retail/service businesses. Rents could potentially increase by 2-4% annually due to steady demand.

2. Cedar Rapids/Iowa City Corridor:

The Cedar Rapids/Iowa City Corridor is experiencing slow but steady population growth, with an estimated 10,000 new residents expected in the next 5 years, driven by the University of Iowa and healthcare sector. Major economic drivers in the region include the University of Iowa, healthcare (UnityPoint Health), and manufacturing.

• 52242 (Iowa City): High demand due to the University of Iowa. Other major employers include healthcare facilities like the University of Iowa Hospitals and Clinics. Rents could potentially remain stable or increase slightly by 1-2% annually with student housing fluctuations.
• 52401 (Cedar Rapids): Downtown revitalization with new developments. Major employers include UnityPoint Health, Rockwell Collins, and various manufacturing companies. Rents could potentially increase by 2-4% annually as demand rises.
• 52404 (Marion): Family-friendly suburb with a growing population. Major employers include retail/service businesses and healthcare facilities. Rents could potentially increase by 2-4% annually due to steady demand.

3. Quad Cities (Iowa & Illinois):

The Quad Cities region, spanning Iowa and Illinois, is experiencing slow population growth, with an estimated 5,000 new residents expected in the next 5 years. Major economic drivers include manufacturing (John Deere), healthcare (Genesis Health System), and education.

• 52801 (Downtown Davenport, IA): Revitalization efforts attracting residents. Major employers include Genesis Health System and manufacturing companies. Rents could potentially increase by 2-4% annually as demand rises.
• 52804 (Bettendorf, IA): Upscale suburban area with excellent schools. Rents could potentially increase by 1-3% annually due to limited availability.
• 52741 (Moline, IL): Across the river in Illinois, Moline offers a mix of young professionals and families. Major employers include John Deere, manufacturing companies, and retail/service businesses. Rents could potentially increase by 2-4% annually due to steady demand.

What areas do you do serve in Iowa?

We work with all properties in Iowa that have a non-rural designation. Use this rural designation search tool to see if your property is considered rural.

How do DSCR loans work in Iowa?

The overall process of getting a DSCR Loan in Iowa is approximately as follows. You submit an application for a loan (you can get started on your loan with an instant quote) answering 14 questions about your property. An instant quote will tell you if you qualify for the loan in under 1 minute of your time. It will also show you the a preliminary interest rate and loan amount. Once you select desired LTV (which can be changed later), your quote will be converted to a Loan File for processing purposes.

You will have to submit documents as part of your Loan File for underwriting. Documents we may ask for will include personal and property documents such as purchase contracts, current leases, borrowing entity documents, deeds, title work (we will engage a title company or an attorney on your behalf to draw up these documents), background and credit reports (that we will order), bank statements for liquidity verification as well as other documents that may be applicable to your specific deal. Full list of requirements can be found here in DSCR loan requirements.

We will also handle all the aspects of scheduling and appraisal for you. Please note that we have a promotion, where new clients receive a 100% refund at closing for their appraisal and existing clients forever get a 50% refund for their appraisal at closing as our way to say thank you for allowing us to partner with you! Once all the loan documents are submitted, the Loan File goes through underwriting, at which point the underwriting committee may ask for additional documents depending on their discretion. Once the committee receives all the documents and approves the file, closing can be scheduled.

The closing, will be handled by the title company or at the office of closing attorney. Once closing is complete, funds will be wired. Post closing, the loan will be entered into servicing and you will receive information regarding setting up auto-pay or other options that may be available for your loan depending on the specific servicer's capabilities.

Can you lend on properties worth less then $100k?

In short, no, appraisal as is value must come in at above 100k. We can only lend on properties that are less then $100k if they are in a portfolio with other properties and the portfolio's total as-is value on the appraisal is above $250k. In order to qualify for our loans, the property must appraise for at least $100k as-is at the time of the appraisal, however, total loan amount may be less then 100k, minimum loan amount is $55k.

Do you do cash out refi no seasoning for Iowa loans?

We do offer refinance options with no seasoning requirements. Here is the general criteria for cash out refi no seasoning for Iowa loans. Easiest way to see if you qualify is to answer a few question in our online quoter. It will compare all of our lending criteria against your answers and give you a response in under 1 minute without you needing to read anything. If in case you want to do it the hard way, please read on to see some of the guidelines below with a full list of our requirements here.

Minimum loan amount has to be above $55,000. Minimum As-Is value on the appraisal has to be $100,000. Between 1-4 units. Must have an active lease with proof of security deposit collected. Property condition must be C4 or better. Minimum credit score of 680. Credit score between 680 to 699, gets maximum LTV of 70%, credit score of 700+ gets maximum LTV of 75%. Max LTC, 100% (less than 90 days seasoning), 140% (90 to 179 days seasoning). Minimum verified rehab, 20% of purchase price (less than 90 days seasoning), n/a (90+ days seasoning). Minimum verified rehab, is an improvement that has been done to the unit to verify increase in as-is value in such as short period of time (less then 90 days) to justify the no seasoning period. Origination fee of 1 to 2 points depending on the loan amount to keep the lights on. Lender fee, $1,995 (doesn't go to OfferMarket), includes multiple fees to several different 3rd party verification services, necessary to certify the information in the Loan File for closing. Appraisal at AMC market price, we also have a promotion that new clients get 100% of their appraisal refunded at closing and 50% refund for existing clients. Time to close, 20-25 days.

I know this is a lot of information. You don't have to lift a finger to calculate any of this to see if you qualify, all you have to do is answer 14 simple questions about your deal and we will tell you if we are a good fit for you and what kind of deal we can offer you. To get an answer on your specific situation, please answer 14 simple questions here in our online quoter for Iowa DSCR loans.

Do I need to have my property insured to qualify for funding?

Yes, but if you don't already have insurance, we can roll it into the lending process with no extra charge or effort to you. Our insurance team works with thousands of carriers and is intimately familiar with the insurance requirements of your loan. They will be able to ether talk to the agent of your choice or find the most competitive offer without our network of carriers to complement your loan with no extra effort or expense to you. If you already have insurance, you should get an instant quote to see if we can offer you a more competitive rate and save you thousands of dollars over the lifetime of your policy. Get you instant insurance quote here.

What are the best DSCR Lender Iowa?

There are many DSCR lenders in Iowa and you have many options to get your loan funded. As fellow rental property investors, we built OfferMarket to be a low cost DSCR lender. We believe you should never have to wonder if you're getting the best possible terms from your lender. You should never need to waste time negotiating. That's why we provide you with our best possible term sheet every single time -- you get our lowest rate and lowest fees.

Your first loan with OfferMarket is the start of a long term relationship. It's our opportunity to provide you with remarkable value and prove that we deserve to be your partner on your real estate investing journey. We feel a sense of obligation to prove we deserve your business on each and every loan.

Are you able to lend on rural properties?

We can't lend on rural properties. How can I find out, if my property is rural? Here are more detail on how to verify if your property is rural in our Rural Designation Search Tools. The 2 search tools are hosted by USDA Rural Development Property Eligibility and CFPB Rural and Underserved Areas Checker. Both of the tools must flag the property as none rural for it to be eligible for our funding. Use these instruction to find out if your property is considered rural

What are the requirements for a DSCR loan in Iowa?

If you scroll up on this page, you will see a simple checklist that details high level requirements for our DSCR loans in Iowa. If you want a more detailed quote for your specific deal, click "start" next to "apply for a DSCR loan" and our online quoting system will produce an accurate quote based on 14 questions related to your deal. Most investors are able to get a complete quote in under a minute because those 14 questions most investors will know answers to. Our most detailed DSCR Loan Requirements can be found here. Once you complete an online quote, you can proceed to your Loan File, where you can peruse the Loan Terms which will detail all the fees and proceeds of the loan in one convenient interface. Get an instant loan quote and Loan File

Otherwise, you can read on to see common guideline breakdowns:

Credit Score

In most cases, a 720 credit score will qualify you for the lowest interest rate and highest loan amount. We recommend protecting your credit score and striving for a 740+ score to make sure you get the best terms.

No Seasoning

Most DSCR lenders require 6 months of seasoning. At OfferMarket, we have a no seasoning program for qualified borrowers. We also offer 90 day (3 month) seasoning for borrowers with 700+ credit score or 5+ rental experience.

Rural Properties

Rural properties are not a good fit for DSCR loan programs. If your property is considered rural in any of the following ways, it may not be eligible:

• Rural designation by Federal Government (CFPB, USDA)
• Rural designation by appraiser
• Population under 10,000
• 5+ miles from a 100,000+ population center

Rural designation is a gray area so we recommend proceeding with caution on any purchase where the subject property checks one or more of the above bullets. We can't lend on rural properties. How can I find out, if my property is rural? Here are more detail on how to verify if your property is rural in our Rural Designation Search Tools. The 2 search tools are hosted by USDA Rural Development Property Eligibility and CFPB Rural and Underserved Areas Checker. Both of the tools must flag the property as not rural for it to be eligible for our funding. Use these instruction to find out if your property is considered rural

Full list of requirements can be found here in DSCR loan requirements.

How to get a DSCR Loan in Iowa?

The easiest way to start your Iowa DSCR loan is to click the start button next to "apply for DSCR loan" banners at the top or bottom of this page. OfferMarket's team has expansive experience working with real estate investors across Iowa.

What are the requirements for a DSCR loan in Iowa?

If you scroll up on this page, you will see a simple checklist that details high level requirements for our DSCR loans in Iowa. If you want a more detailed quote for your specific deal, click "start" next to "apply for a DSCR loan" and our online quoting system will produce an accurate quote based on 14 questions related to your deal. Most investors are able to get a complete quote in under a minute because those 14 questions most investors will know answers to. Our most detailed DSCR Loan Requirements can be found here. Once you complete an online quote, you can proceed to your Loan File, where you can peruse the Loan Terms which will detail all the fees and proceeds of the loan in one convenient interface. Get an instant loan quote and Loan File

Why use Iowa DSCR Loans to buy investment properties?

DSCR (debt-service coverage ratio) loans can help real estate investors shorten their cash cycle and grow their rental portfolios more rapidly in a few key ways. First, the higher leverage and lower down payments allowed by DSCR loans mean investors can acquire more properties with the same amount of cash on hand, rather than tying it all up in larger down payments. Additionally, the option for interest-only payments creates more positive cash flow that can be reinvested into new property acquisitions. Finally, DSCR underwriting based solely on the rental income of the property itself, rather than the investor's personal income, enables investors to scale their portfolios more quickly without running into debt-to-income ratio restrictions.