Investor Loans
Financing for real estate investors in New Jersey and Pennsylvania — from your first rental to your tenth.
Whether you are buying your first investment property or scaling a portfolio across New Jersey and eastern Pennsylvania, the financing strategy matters as much as the deal itself. We offer DSCR loans, conventional investment mortgages, and portfolio solutions — and we will help you pick the right tool for each property.
Investor loan programs
Investment property financing works differently than buying a primary residence. Here are the programs we use most and when each one makes sense.
DSCR loans (Debt Service Coverage Ratio)
DSCR loans are the go-to for experienced investors. Instead of qualifying based on your personal income (W-2s, tax returns, pay stubs), DSCR loans qualify based on the rental income the property generates. The lender compares the expected rent to the mortgage payment (principal, interest, taxes, insurance, and HOA). If the rent covers the payment, you qualify. No tax returns needed. No employment verification. This is why DSCR loans have become the standard for scaling a rental portfolio.
DSCR = Monthly Rent / Monthly PITIA. Example: $2,200 rent / $1,800 PITIA = 1.22 DSCR. A ratio above 1.0 means the property cash flows positively. Above 1.25 gets you the best rates. Some programs allow DSCR below 1.0 with higher down payment or reserves.
Conventional investment property loans
For investors with strong W-2 income or documented self-employment income, conventional investment property loans through Fannie Mae offer the lowest rates. The tradeoff is full income documentation and limits on how many financed properties you can have (typically up to 10). This is the best option for your first 1 to 4 investment properties if you have the income to qualify.
Bank statement loans for investors
If you are self-employed or have complex income that does not show well on tax returns, bank statement programs use 12 to 24 months of bank deposits to calculate qualifying income. This bridges the gap between conventional (which requires tax returns) and DSCR (which requires the property to cash flow). Useful for investors whose personal income is strong but documented unconventionally.
Investing in New Jersey real estate
NJ has unique characteristics that affect how you analyze deals and structure financing.
Property taxes impact your cash flow math
NJ property taxes average 2.2% and can run over 3% in some counties. On a $400,000 rental property, taxes could be $8,800 to $12,000 per year — that is $733 to $1,000 per month before you even factor in the mortgage. This makes DSCR analysis critical. A property that looks like it cash flows in most states might be break-even or negative in NJ once taxes are factored in. Always run your numbers with actual tax amounts, not estimates.
Strong rental demand supports DSCR qualification
NJ consistently ranks among the top states for rental rates. The median rent for a 2-bedroom is above $1,800 in many markets. Strong rental demand from commuters to NYC and Philadelphia, growing remote work migration, and limited housing supply keep vacancy rates low. This translates to reliable DSCR ratios that lenders want to see.
Multi-family properties and house hacking
NJ has a large inventory of 2-4 unit properties, especially in cities like Newark, Jersey City, Paterson, Camden, and Trenton. If you live in one unit and rent the others, you can use FHA financing (3.5% down) on a multi-family up to 4 units. The rental income from the other units helps you qualify for the loan. This is the most accessible entry point for new investors — low down payment, owner-occupant rates, and immediate cash flow from tenants.
LLC and entity structuring
Most experienced investors hold rental properties in an LLC for liability protection. DSCR loans can close directly in the LLC name. Conventional loans must close in your personal name but can be transferred to an LLC after closing (check with your lender on due-on-sale clause implications). We help investors understand the financing implications of entity structure before they set up their LLC.
Investing in Pennsylvania real estate
Better cash flow math than NJ
Pennsylvania property taxes average 1.5% compared to NJ at 2.2%. On a $300,000 rental, that saves about $2,100 per year in expenses — going straight to your bottom line. For DSCR qualification, lower taxes mean a stronger ratio on the same rent amount. Many NJ-based investors are buying in PA specifically for the improved cash flow.
Transfer tax on acquisitions
PA charges 2% transfer tax on purchases (1% state, 1% local), typically split between buyer and seller. Philadelphia is 4.278% total. Budget your half (1% in most counties) into your acquisition costs. On a $250,000 investment property, that is $2,500 in additional closing costs versus NJ.
Philadelphia and the surrounding counties
Philadelphia offers lower entry prices with strong rental demand from the university and hospital systems. Bucks and Montgomery counties attract higher-end tenants with lower vacancy rates. Chester and Delaware counties have growing suburban rental markets. Each area has different rental dynamics — we help you match the right financing to the right market.
LLC-friendly environment
Pennsylvania LLC formation is straightforward and affordable. DSCR loans close directly in the entity name in both NJ and PA. For investors building a portfolio across both states, having separate LLCs per property or per state is common practice for liability isolation.
Common investor scenarios
If you have W-2 income, conventional financing gets you the best rate with 15% to 25% down. If you want to house-hack a multi-family, FHA at 3.5% down is the most capital-efficient entry. We will compare both paths side by side.
This is where DSCR loans shine. No income verification, no limit on property count, and you can close in an LLC. The rate premium over conventional is typically 0.5% to 1%, but the scalability and simplicity are worth it for portfolio growth.
Cash-out on investment properties allows up to 75% to 80% LTV depending on the program. If your property has appreciated, you can pull equity to fund the down payment on your next acquisition. DSCR cash-out refinances do not require income docs — just the property cash flow.
DSCR loans are available to foreign nationals without US income documentation. Requirements typically include a larger down payment (25% to 30%), a US bank account, and a valid passport. NJ is one of the top markets for international real estate investment.
Some DSCR lenders accept short-term rental income using AirDNA projections or actual booking history. The key is verifying that local regulations allow STR in your target area. NJ municipalities have varying rules on short-term rentals — we help you understand the financing side while you verify the regulatory side.
Frequently asked questions
A DSCR (Debt Service Coverage Ratio) loan qualifies you based on the rental property cash flow instead of your personal income. No tax returns, W-2s, or employment verification needed. The lender divides expected rent by the total mortgage payment — if the ratio meets their minimum (usually 1.0 to 1.25), you qualify.
Conventional: 15% to 25% depending on units and occupancy. DSCR: typically 20% to 25%. FHA (owner-occupied multi-family): as low as 3.5%. The more you put down, the better your rate and cash flow position.
Yes. Conventional loans use 75% of market rent to offset the property payment in your DTI. DSCR loans use 100% of market rent as the primary qualification metric. FHA multi-family loans count 75% of rent from non-owner units.
DSCR loans can close directly in an LLC. Conventional loans must close in your personal name. Many investors close conventional in their name and then transfer to an LLC, though you should consult with your attorney on due-on-sale implications.
Conventional: up to 10 financed properties with Fannie Mae. DSCR: no limit on property count — each deal is evaluated on its own cash flow. This is why DSCR becomes essential once you scale past 4 to 5 properties.
Have a deal? Let us structure the financing.
Whether you are analyzing a potential acquisition or ready to move, we will help you pick the right loan product and structure for maximum cash flow.