DSCR Loan Processing Timeline: Investment Property Processing Breakdown
DSCR loans for investment properties in Colorado close in 25–40 days. The main variables are: property type (short-term vs. long-term rental income), appraisal turnaround, and entity vesting.
Day-by-Day Timeline
- 1Day 1–3: Confirm DSCR ratio with rental income analysis
- 2Day 3–7: Application, disclosures, identify DSCR investor
- 3Day 7–10: Submit to DSCR investor
- 4Day 10–15: Appraisal ordered with 1007 (comparable rent schedule)
- 5Day 15–22: Appraisal and 1007 received
- 6Day 22–28: Underwriting review
- 7Day 28–33: Conditional approval, conditions collected
- 8Day 33–37: CTC received
- 9Day 37–40: Closing
How CTC Manages This Process
DSCR loans qualify based on the property's cash flow, not the borrower's personal income. CTC calculates DSCR ratio at intake and identifies the right DSCR investor based on property type, LLC vesting, and rental income source.
Frequently Asked Questions
How is DSCR calculated?
DSCR = Gross Monthly Rent / PITIA (principal + interest + taxes + insurance + HOA). A ratio of 1.0 means rent exactly covers the payment. Most DSCR lenders require 1.0–1.25 minimum.
What is a 1007 and why is it needed for DSCR loans?
The Form 1007 is a Comparable Rent Schedule completed by the appraiser, showing comparable rental properties and estimating the subject property's market rent. DSCR lenders use this rent estimate to calculate the DSCR ratio.
Can I close a DSCR loan in an LLC?
Yes — many DSCR investors allow LLC vesting. CTC identifies DSCR lenders that allow the specific LLC type (single-member, multi-member). Some investors require a personal guarantee from the LLC member.