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Do DSCR loans have prepayment penalties?

Short answerOften, yes. Many DSCR loans carry a 1–5 year step-down prepayment penalty, such as 5-4-3-2-1 percent. You can usually buy out the penalty for a slightly higher rate.
Reviewed by Juan Fernando Romero, NMLS 2557318Updated

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Investment property

DSCR Loans

A DSCR loan is an investment-property mortgage that qualifies you on the property’s rental income divided by its monthly payment (the debt service coverage ratio).

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