10/19/2025
Predatory Lending and how it creates problems when applying for home loans.
Let’s address this, high interests rates in 2025 makes getting a traditional loan seem almost predatory when rates are at a 7% all time high, making monthly payments $900 or MORE! Mean while max rents in many markets are hovering at $1200 per month or less.
This means a homebuyer with the intent to live in the property is buying a property that DOESNT CASH-FLOW. I.e. the monthly payments are more than the market rent.
This creates a problem and in our book, is considered predatory because the lender, agent and whoever else invoked see it.
If you use DSCR loans to buy the only qualification the need is DOES IT CASHFLOW ,
Can I RENT this out for MORE than the all in monthly payment, if so you just got an asset, not a liability
If it does, 20% down and they will cover all other costs possibly including the rehab, this just depends on what you work out or need.
I’m not a fan of traditional financing other than FHA.
Predatory Lending in 2025.
