(May 30, 2023)
I started things off with the Oysters; This was a spectacular way to start things. You must try the oysters when you're at a seafood spot. They were so good, and I had to get my go-to side of horseradish. I started things off with the oysters. They were so good, and I had to get a different side of horseradish, which is my go-to whenever I'm eating oysters. It was a spectacular way to start this meal off. Next up were the bacon-wrapped dates. They were sweet, smoky, and crisp, and the best part was being able to devour them in one bite! I usually only eat these on Thanksgiving, and I love them, so when I saw it on the menu, I had to try them, and I'm so happy I did. For the main course, I went with the Fruit of the Sea, which has fresh local shrimp, scallops, and calamari tossed with garlic and served over angel hair pasta with three sauces. I must admit, I love angel hair pasta and think it brings a meal over the top, and that's exactly what this did. The shrimp, scallops, and calamari were so fresh and delicious.
If you're in the area, I highly recommend this spot. FoodiePhil rates this an 8.3; check it out (and bring me with you)! You won't get the flavor profile from any other restaurant within a 30 mile distance.
Send me your recommendations!
In this week's newsletter, we are going to discuss DSCR loans. A DSCR loan compares an investment property's cash flow to the monthly payments, not the investor's income. This quicker and more flexible process helps full-time investors, self-employed buyers, or anyone with complicated tax returns. Today, we are going to focus on three critical aspects of a DSCR loan:
- How Does a DSCR Loan Work?
- How is DSCR Calculated?
- How to Determine DSCR Income
1. How Does a DSCR Loan Work?
The debt-service coverage ratio applies to personal, government, and corporate finance. It helps measure the available cash flow used to settle existing debt obligations. You can use this figure to determine whether you have enough income to meet your debt obligations. With a DSCR loan, you get to qualify for financing without having to use your tax returns. The loan also allows you to avoid the high points and high rates on conventional private loans, strict lending criteria, and lengthy approval processes. You can consider it a no-income loan since it lets you qualify for financing on your property's cash flow rather than your income. Getting a DSCR loan is an excellent way of expanding your investment portfolio to new lengths. It allows you to qualify quickly and pursue your investment goals. And since you will write off all expenses on your property, the loan may be a perfect choice over a conventional loan.
2. How is DSCR Calculated?
Calculating the debt service coverage ratio is dividing your net operating income by your total debt obligations. Your total debt obligations, in this case, include interest and principal payments on a particular loan. DSCR is essential when negotiating a loan contract with your loan provider. It can help a financial institution manage its lending risks and an investor/analyst analyzes a company's financial strength. Calculating your debt service coverage ratio is advisable when you want to gauge your financial health and ability to meet debt obligations that are almost due. Note that your debt service and operating income will affect the ratio. Debt service refers to the credit you take to finance a particular need or project, while operating income refers to the income remaining after deducting your day-to-day expenses.
3. How to Determine DSCR Income
Your net operating income (NOI) helps analyze the profitability of the real estate properties you invested in to get income. It is a sum of all revenue derived from the properties without the required operating expenses. As a before-tax figure, the NOI appears on a property's income and cash flow statement. It excludes the interest and principal payments on a loan, amortization, depreciation, and capital expenditures. The sure way to calculate NOI is to subtract your operating expenses from the total revenue a property generates. Revenue, in this context, may include rental income, service charges, parking fees, and fees charged on laundry machines and vending machines, among others. Your operating expenses may include costs that help keep the property running. Examples of these costs include maintenance, repair, property taxes, utility bills, insurance premiums, and management fees.
In a nutshell, the DSCR is essential when considering investing in commercial real estate. It is because lenders want to ensure that you are in a better position to repay the loan—all the best in considering a DSCR loan to grow your real estate portfolio.
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(May 30, 2023)
