BiggerPockets Daily

DSCR loans, while still a relatively new product, continue to expand in use and popularity for investors looking to achieve financial freedom through real estate. Throughout 2023, we have published several articles on DSCR loans, introducing the BiggerPockets community to how interest rates and terms are determined, giving answers to frequently asked questions about DSCR loans and talking about exciting new developments and expansions of the product, including DSCR loans for five- to 10-unit multifamily properties.

This article will cover another big aspect of DSCR loans–specifically, what documents you will be expected to provide once you have decided to go with a DSCR loan. 

One of the most enticing aspects of DSCR loans for investors is the lower documentation, paperwork, and overall “hassle” when compared to more traditional lending, including conventional and bank options. However, DSCR Loans should not be considered “no doc” loans–they do include a well-thought-out underwriting process and meaningful “common-sense” documentation requirements as well. Sometimes people can be misinformed, thinking these are loosely originated mortgage loans akin to the “NINJA” (no income, no job, and no assets) loans that were common in the early 2000s and helped lead to the last real estate crash.

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In a recent economic outlook by Morningstar, the housing market affordability is currently mimicking the peak of the housing bubble in 2006. This similarity is due to a combination of mortgage rate hikes, rising home prices, and income levels. 

In light of this, Morningstar suggests that falling mortgage rates will play a vital role in improving housing affordability by 2025. Here, we’ll shed some light on the various factors that are making an impact on mortgage rates and what it will mean for American real estate investors.

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As a real estate investor, you should understand the NAICS code that relates to your industry.

This article discusses the finer details of this code system and its impact on your business. 

The North American Industry Classification System (NAICS) is developed by the United States, Canada, and Mexico to classify businesses into industry-specific categories for economic data collection, analysis, and reporting.

In some states, providing your NAICS code is optional, but in other states, providing your code will be required.

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I recently got an unexpected lunch invitation. The most successful real estate developer I know made a beeline for me in the church lobby. He requested lunch as soon as possible. 

We met for lunch the next day. We hadn’t even ordered when he started pouring out his heart: 

“I’ve got a problem. I’ve been doing business with two banks for decades. One of the bankers has become a close personal friend.” 

He paused with a pained, pensive stare at nothing. 

“But they’re both acting…weird. They seemed nervous last fall. But now it’s more serious than that.” 

He went on to describe how his favorite banker changed the terms and then outright canceled an approved loan days before closing a few weeks before. This deal had been in the works for well over a year. My friend had to make a painful phone call to the seller to sheepishly ask for an extension to a now-uncertain closing date. 

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Large investors expanding their affordable housing portfolios has recently become a notable trend in the real estate market. Nuveen, the investment management division of the Teachers Insurance and Annuity Association of America (TIAA), made headlines with its acquisition of a substantial 12,000-unit affordable housing portfolio, predominantly located in the mid-Atlantic region, with a significant concentration in New York City. 

Nuveen, which manages $1.1 trillion in assets, is now managing a $6.4 billion portfolio of affordable housing. Prior to this deal, Goldman Sachs, alongside the Michaels Organization and the Community Development Trust, purchased $1.2 billion worth of affordable housing across the United States earlier this year. These investments reflect a growing trend among large investors who recognize the advantages of affordable housing investment. 

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Think big! Accumulate hundreds or even thousands of units. Use economies of scale. Syndicate. Benefit from maximum leverage. In other words: Go big or go home.

Aren’t these the messages we hear so often here on BiggerPockets? Aren’t the biggest and the best the ones with the most cash flow, the most flips, and the most rental units?

Well, I’m here to tell you that bigger is not always better. In fact, in this article and my new book, The Small and Mighty Real Estate Investor, I plan to show you that smaller and simpler is actually better for many of you.

I’m trying to start a new movement. I hope some of you will join me. The motto is “go small or go home.” And the hero is called the small and mighty real estate investor.

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Think big! Accumulate hundreds or even thousands of units. Use economies of scale. Syndicate. Benefit from maximum leverage. In other words: Go big or go home.

Aren’t these the messages we hear so often here on BiggerPockets? Aren’t the biggest and the best the ones with the most cash flow, the most flips, and the most rental units?

Well, I’m here to tell you that bigger is not always better. In fact, in this article and my new book, The Small and Mighty Real Estate Investor, I plan to show you that smaller and simpler is actually better for many of you.

I’m trying to start a new movement. I hope some of you will join me. The motto is “go small or go home.” And the hero is called the small and mighty real estate investor.

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Wholesaling is a popular strategy that many real estate investors use to earn money from homes without owning them. They get to avoid dealing with maintenance issues, tenants, and other landlord issues necessary with other strategies.

If you are interested in wholesaling but aren’t sure about how to find potential properties, there are several simple things you can do to locate them. Wholesale opportunities come up all the time. With the right marketing strategies in place, leads may come to you. This lets you concentrate on what you do best—closing deals.

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The internet altered the world, and for the most part, it was a good thing. Most products and services got better, but not insurance—it got lost.

Before the internet, the insurance sector centered around an agent-driven business model in which insurance companies manufactured products and insurance agents sold them to consumers: home, vehicle, life, and business insurance.

Insurance carriers learned that with the internet, they could sell straight to the consumer through the click of a button—eliminating the local agent’s need for a sales commission. Because of this shift, most insurance agents nowadays lack the knowledge and in-depth understanding of the coverage they provide in the complex 100-page contracts they sell. This results in the slow, agonizing demise of the professional insurance salesperson

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Many successful real estate investors know the secret of finding and buying off-market properties. While discovering these deals may be tricky, you may stumble upon a great and lucrative real estate investment if you know how to find off-market properties.

What is the best way to find off-market sales? Are there advantages to searching off-market property sales for investment opportunities? What should you be careful of when buying a property off-market? This article answers these questions and many more.

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