Real Estate Growth Using DSCR Loans with Alex Bekeza

In this episode of The Rent-ish Podcast, Zach and Patrick sit down with Alex Bekeza — the most highly reviewed loan officer on BiggerPockets, to break down DSCR loans (Debt Service Coverage Ratio), how beginners can get started, and what you need to know about the lending market heading into 2026.

Whether you're trying to scale your rental portfolio, BRRRR your way to freedom, or lock in financing that actually works, this episode is loaded with strategies you can act on.

We cover:

• How DSCR loans actually work (in plain English)
• Market outlook and what investors should expect
• Common mistakes and how to avoid them
• Tips for first-timers getting into creative financing

Alex has personally originated over $100M in loans via BiggerPockets, is a seasoned BRRRR investor in Missouri and Texas, and a full-time dad of 3 who coaches baseball and trains Jiu Jitsu when he’s not helping investors scale.

If you’re serious about real estate, this one’s a must-listen.

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Transcript

SPEAKER_02 0:35

What's going on everybody? Welcome to season two of the Rent-Ish Podcast. I'm Zach here with my co-host Patrick.

SPEAKER_03 0:41

We're two rookies chasing the dream of real estate investing. In this podcast, we'll talk about property management, wild stories, and everything in between. We don't know it all yet.

SPEAKER_02 0:51

But that's the point. We're learning as we go, just like you. We'll bring in the experts to educate and inform us and we'll figure it out together. So let's laugh, learn, and dive into real estate side by side.

SPEAKER_03 1:02

Zach, how are you doing on this beautiful Monday?

SPEAKER_02 1:04

Whoa, it's changing it up. I like that. Yeah, that's cool. That's really fun. I don't know how to answer the question because I'm so taken aback by you asking about my current status instead of me flipping it around the idea. That's really sweet of you. I'm tired. How are you today? I'm also pretty tired, but um You said you had to get you were forced awake an hour and a half early because of your your girlfriend's mother. Yeah, so she's um You want to elaborate on that?

SPEAKER_03 1:30

Yeah, she was going to the airport um and then wanted to see our apartment because my girlfriend moved in with me, and so she was checking out the apartment at 7 45 a.m. So I had to be up and dressed before then. Um yeah, so that's like asked crack of dawn for me.

SPEAKER_02 1:44

That's uh Yeah, I want all of our listeners to email questions at therentichpod.com if you think 7.45 is the crack of dawn. I I have a feeling like a lot of people are gonna disagree with that sentiment. But I was from the stay, what's the crack of dawn? For me, it's when light crests over the the the hill for the first time.

SPEAKER_03 2:02

It's like 5 a.m. like 5.30. That's late at night. So that's still the night, dude. That's not the morning.

SPEAKER_02 2:12

That's a late night right there. Okay.

SPEAKER_03 2:14

That's crazy.

SPEAKER_02 2:15

This is the Rentage Podcast, a podcast about property management and real estate.

SPEAKER_03 2:20

Yeah, wait, don't we have an expert on today?

SPEAKER_02 2:22

Yeah, we do have an expert, so uh it's gonna be quite the change of pace. No, thank you for listening to another episode of the Rentage Podcast. Today we have a great guest who's going to teach us all about loans, investing, and brrrrr. Because it's cold. You know what I mean? But that's also an acronym. So I'm told. Or you might hear about it in the interview coming up that we have with uh Alex Bakiza. Uh so stay tuned for that. Uh, and remember to follow the podcast online, the Rent-Ish Podcast on basically any podcast platform where you get your shows. Uh email questions at the rentish pod.com, follow us at the rent-ish pod on social media. And uh, Patrick, what do you say? We just kick it over to the interview. Let's do it. Welcome back to the Rent-Ish podcast. Today we've got a really, really exciting guest who's going to be joining us, someone who's been making serious waves in the real estate investing world.

SPEAKER_03 3:16

That's right. We're talking with Alex Bakiza, the most highly reviewed loan officer on BiggerPockets.com. So really bringing in the big dogs this time. Alex specializes in DSCR-based financing, which I'm excited to learn about what that is. Uh, and purchased and rehab loan products. He's originated over a hundred million dollars in loans for investors. Yep, that's right, Patrick.

SPEAKER_02 3:41

Not only that, he's also an investor himself, a BRRRR guy with a portfolio of rentals in Missouri and Texas. So Alex really gets both sides of the table. Alex, welcome to the show. All right, yeah, appreciate the intro, guys. We really rehearsed that multiple times as you can't tell. We were in this. We'll unpack a few of those acronyms. Yeah, exactly. Yeah, we're gonna unpack the acronyms. We're gonna talk about a lot of stuff. We're gonna really get to know Alex here. He's we an awesome guest. We're very, very happy to have you on board the Rentish pod. Come and hang out with us. Um, at the top of the hour, though, I gotta, I gotta tell you a shout-out. I know we know how we have audio listeners, we have video listeners now. I gotta give you shout out to your fish tank back there.

SPEAKER_00 4:22

Oh man, yeah. This was, you know what, this was my COVID era uh gift to self, stay sane, having to work from home uh investment, if you will. That's nice. It's a good backdrop.

SPEAKER_02 4:33

It's like, are is he in an office? Is he in the ocean? I can't tell. It's pretty crazy.

SPEAKER_00 4:37

Yeah, this is this is the home office today. Yeah. Cool. And I it honestly is a nice relaxing thing. You actually find a lot of like high-stress jobs, keep one in nearby, like uh attorneys and doctors and things like that.

SPEAKER_02 4:50

Amazing. Well, uh you've definitely encouraged me to maybe invest in the fish tank market. So talking about your market, real estate, we're we're gonna we we want to kind of get to know you a little bit. Tell us who you are, what like kind of where you've come from, what made you interested in the real estate industry, what got you into the industry? Just kind of tell us a little bit about your backstory and your your story leading up to now.

SPEAKER_00 5:11

Yeah, I think it's probably really relatable for a lot of your audience who's just trying to break into it because uh, I mean, I really came out of nowhere, right? I was um a restaurant general manager down here in SoCal and Malibu and Santa Barbara, Calabasas areas, and I just really hustled my way in up into that spot in my early 20s, going from the the busboy to the food runner to the server to the system manager to the GM. And then I think it was a great experience to you know spin a lot of plates at once and and have a lot of people working under you and working through a lot of like uh day-to-day situations, people problems. And then I just got lucky really and had some people who were killing it in real estate who had known me from when we were young, had seen me hustling in the restaurants and and said to me one day, hey Alex, you really gotta stop doing what you're doing, especially as I had my first child and they knew I was barely seeing him, right? I was going dawn to dusk in the restaurants.

SPEAKER_01 6:02

Sure.

SPEAKER_00 6:03

And uh they said, Come in and learn how to do mortgages. This is about a decade ago. And I kind of blew them off, you know. I I said, uh, you know, that's too intimidating. I don't know what LTV means, I don't know what APR, none of that stuff is, you know, it's not really for me. And uh I think I was working on Christmas Day, missing it with my little ones, and called them back and said, Hey, let me come learn what you guys do over there, you know? So gives you a little bit of context for why I was so motivated to get on bigger pockets and start learning about real estate from scratch. And within the first few months, what I realized a lot of people all over the country were looking for were these certain products and for certain strategies, like DSCR loans, uh hard money loans. And these weren't necessarily niches that a lot of my colleagues were focused on, but it's really a way that I carved my own lane, right? And I found it the most interesting because it's it's so different from conventional financing, right? I'm not calling your employer, I'm not calculating your debt-to-income ratio and working through your pay stubs or anything like that. It's really more about business purpose and and deal making. And does this deal make sense?

SPEAKER_02 7:05

Okay. Yeah. So at what point in the process, like low so loan officer, you were you work with all this different stuff. What when did that officially get you? When did you get that stamp? When when did that happen for you officially?

SPEAKER_00 7:18

Yeah, so for a little while I was like just getting my uh cutting my teeth, if you will, processing loans for experienced brokers, doing some kind of like initial lead gen type stuff, but during that time I'm getting my licensing and whatnot. So I'd say like sometime in 2017, I I officially got licensed as a loan originator and started getting very active in the forums, you know, because I come across stuff on bigger pockets all the time. People would say things like, Oh, my loan officer says my debt-to-income ratio is uh doesn't work for this purchase or this refi. But I have the cash, I have the income. You know, it's just the way that they're calculating it on their end. Or they'd say stuff like, I want to vest title in my LLC, but my loan officer says I can't do it. Or maybe most crucially was this one, my I I I just renovated this house, but my loan officer says I need to wait six or twelve months before they can use the new appraised value to do a cash out refi. And that's where I that question right there, which to this day is gonna come up on BP every single day, is where I started injecting myself, just giving advice. Because you can't really be salesy in the forums there. They don't want you to people kind of do it, but you're not really supposed to be soliciting business, you're supposed to be like giving information. Um, but I found that if you just consistently do that every day, you know, people are gonna come across you and you're you're an authority on the topic, and they'll reach out to you. And and I that's the approach I took because I really hated cold calling. I was like, I I need I need like a good way for people to want to call me. Yeah, and that's how I found it.

SPEAKER_02 8:46

Yeah. Did you have a good uh opening line to break the ice when you were doing the cold calling days?

SPEAKER_00 8:51

Oh, yeah, I mean sort of because like it it really, and this is why I hate cold calling, because you could have a rock solid, like shooting fish in a barrel type of offer to somebody, but like nine out of ten people just aren't don't have their ears open to it if if it's a cold call, right? Like in our case, we really were, we had a huge list of of borrowers who had rates that were in like this at the time sevens and eights and nines, and we were very familiar with who wrote those notes, what the prepayment penalties were. So we knew almost every person we called we could provide a tremendous benefit to, right? We here we have a program with the identical terms to the or identical guidelines to the one you have, but with rates three, four percent lower, you know. So, you know, but even with that, I just I I did I didn't enjoy it. What I what I enjoyed was people want what I am offering and they are trying to get in touch with me. Or, I mean, and then as time goes on, it just gets better and better because it becomes more of like a word of mouth business. Now I rely much less on being in the bigger pockets forums and much more on nurturing the relationships I already do have, which uh naturally, you know, bring in a lot of people because these are people who are part of their local meetups and they're in Cincinnati or New Orleans or LA, all over the country.

SPEAKER_02 10:02

I mean, it sounds like Bigger Pocket, like Bigger Pockets obviously has you've built this great reputation, but Bigger Pockets, Bigger Pockets also has a reputation of being like this great resource for so many people. I mean, the community has been, I'm sure, a big uplifting force in like driving your career forward. Um, I mean, you recommend that as a tool for basically any new property manager or landlord or anything like that, right?

SPEAKER_00 10:25

100%. It's it's actually the most easy answer I ever give someone. Like, because all the time, people who know me or meet me from outside of real estate, they are curious, right? Like, oh, I've always wanted to do that. Right. It's been on my back burner for a while. Like, you know, best advice I can give you is to get on bigger pockets because I mean, just about any question you could possibly have has been asked there, right? Hey, I'm looking for a plumber in Cincinnati, or hey, I know any good property managers in this town, or hey, I'm self-managing. What do I do when my tenant says this? Like a lot of that has been answered and it's it's pretty sortable. And yeah, you just gotta throw yourself in and start start listening to podcasts like this and and other ones like like BP, you know?

SPEAKER_02 11:27

Yeah, if you want to listen to this podcast, you're gonna really learn something because we're starting we started at zero. So well, think back. Think think all the way back. And I'm sorry, Patrick, I don't mean to steal every question out of the out of the ether here, but I'll give you a chance to chime in in a minute. Yeah, think back all the way back to like your very first deal. Like you are like when you're getting when you're getting into the industry, your your first property or deal, like what was it like? What do you remember? Any any like mistakes that you made that you still hold on, like that you you thought was a great learning experience, like that first time out the gate out the gate. Do you do you remember it very clearly at all?

SPEAKER_00 12:03

Yeah, I do. And I and I I always felt very um self-conscious of perhaps saying the wrong thing because you don't there's so many things in this world that you just don't know until you come across it, right? And so it's kind of a hard industry to break into in that sense because there's a lot going on, right? So the biggest mantra I kind of kept telling myself was the obvious one all the salespeople kind of you know have, which is you know, underpromise and overdeliver. But another one that's great for me that always seemed to work because as long as you're showing good faith in everything else you do with that person, they're never gonna get mad at I don't know, but I'll find out. Right? So I I find that people who end up like torturing your reputation are the ones that don't do that, and they'll they'll confidently say something that they're not really sure about and then throw off the whole experience and possibly a deal, possibly money, right? This is um in many cases, this is the I'm I'm involved with maybe the largest transaction, largest financial transaction of this person's life, you know.

SPEAKER_02 12:57

That is power. That is that is uh that is a lot of response. It's like the old Spider-Man quote. What with great power comes great responsibility, needing to make sure that you're on top of things.

SPEAKER_00 13:06

And to that, to that topic too, like part of how I never get out over my skis on that type of thing now and can manage a pipeline of 40, 50 deals at a time in process is um by not being a master of none, right? I I really try to stay in my lane with these DSCR loans or these fix and flip products. They're a great one-two punch to each other, they complement each other for certain strategies. And um good news is our company has a bunch of other loan officers who love to specialize in different stuff, you know. So if you got VA scenarios, conventional scenarios, you know, agency commercial scenarios, odds are I have someone within arm's reach who uh would take great care of you. But by staying in my lane, it helps me become an expert and um practicing the same kick a thousand times kind of thing, you know?

SPEAKER_03 13:48

Okay. You you explained earlier that you shifted gears from the restaurant business to become a loan officer, but you also own properties of your own, like rental properties of your own.

SPEAKER_00 13:58

Is that right? Yeah, that's right. So again, wouldn't happen without bigger pockets because they it kind of simultaneously fostered and fueled my loan officer position while also really like, you know, I was just like every other user trying to learn for my own sake, right? Especially when I would I start doing all these deals, and I'm like, man, this guy has 10 houses, you know, how did he do this? And let me reverse engineer this a little bit for my own sake, you know? And so how I cracked into my own, my first deal as an investor was after a couple years of being a mortgage loan officer, I guess I'd been doing it for like maybe two, three years, finally started making some great income, and I had two borrowers, they didn't even know each other, but I was speaking to both of them like every other day, it felt like because they were both doing burr and flip in St. Louis, Missouri, like once or twice a month with me. One or two deals a month each. So after after like a year or so of doing that, you know, I sit back and I have dozens of uh appraisals in my Google Drive in the same zip code, and they're all very similar deals, right? You can kind of narrow it down to okay, here's uh a 3-2, he bought it for this, he put this into it, and it was worth this much after. And so I just tried to kind of mimic deals that I saw working out really well that were scalable, but my first deal was not like most people's first deal at all. So, you know, I took a I took a huge risk, uh, but it all worked out. I so one of these clients, um, great guy, I'm still friends with him to this day, became the seller in this situation because he was a very active flipper in St. Louis, but he lived here in Los Angeles, um, working in the music industry. And I had met him at a local meetup. And what you might remember around that time is that Hollywood shut down. So uh one of the most locked down elements of the country was all that film production stuff. So a lot of people, a lot of people who were, you know, working on shows, the shows were canceled until further notice. So um, if you can imagine this, this guy has several you know hard money loans out, his great income just vanished overnight. He can't even send workers to a lot of these job sites. If you recall, it was hard to get even plumbers or electricians or anyone to go out.

SPEAKER_01 16:09

Right.

SPEAKER_00 16:10

And he had a one ballooning note. Um, and for those that don't that don't know what that means, it means that the um short-term loan, like a one-year hard money loan, was coming to an end. And it was at probably like the worst possible like dark hour where like you couldn't get toilet paper, nobody knew what was going on with this thing. Banks weren't really willing to do extensions. They're like, look, I think the world might be over right now. Like, we're gonna call them this thing, do. And um he didn't want to. He had finished the rehab on this, he had it listed for sale because nobody was refining at that time. Like a small small period of time, but like for like three months, he really couldn't get one of these type of loans. I saw him struggling and kind of squirming and feeling the pressure, and you know, a foreclosure or default would have really affected his ability to do other investments, right? So by by any means necessary, he needed to get rid of this one, even if that meant kind of breaking even on it and taking a loss. So after kind of like just having like friendly consult calls, I really I never I wasn't really ready to buy a property. I've been thinking about it a lot, you know, like a lot of your listeners probably, soaking up podcasts and thinking about it a whole lot. But um, you know, I had about a hundred thousand to my name, like all sources, um, you know, retirement stuff that was untapped and savings and everything else. He owed like$85,000 on this freshly renovated duplex. And I had seen the quality of the the rehab because I was CC'd on all the rehab draws and I know him as a person. Sure. Um and so long story short, I worked up the courage to say to him, hey man, um my relationship with you is much more important than this deal. But if you got into the 11th hour and this you'd consider this like a win-win, like a sigh of relief for you, I would pay all cash what you owe the lender. No appraisal, no nothing. Um, just as fast as the title company can move. So somewhat reluctantly, like a day or two later, he said, Hey man, like I it sucks to lose this one, but I'm happy to see you get your first deal. Like, let's do it. And so I was like, now I gotta go explain to my wife that we're gonna completely exhaust the tank, you know, in in the middle of COVID with little kids at home and and like really not sure what was going on next. But you know, we we pulled trigger on it, and then um, you know, things kind of normalized. Not they didn't really normalize, but like banking kind of came back to normal somewhat over the course of the next few months. So I was only completely tied up for like three months, and I didn't do one penny of rehab. He did. I just got it for much less than it was worth under the pr the lender's previous you know underwriting of it. Yeah, and uh it ended up appraising right about where I needed to get a loan for about$85,000, where I'd still cash flow several hundred bucks a month. It was rented for twelve fifty. I think my P ITI was like less than 700 bucks, and I I left almost nothing in it. I left like two or three grand in the deal. Wow. Okay.

SPEAKER_02 18:57

That is a big gamble. So you uh what correct me if I'm wrong, but you may not suggest that level of risk for all new property people looking to get into investing in this.

SPEAKER_00 19:06

No, no, there's way there's way less uh like heart-wrenching ways to go about this, you know. Sure. But but it was one of those things where like I had already worked on this specific deal as the origin the originating purchase loan officer. I had a ton of due diligence on it. In many ways, I had a lot more documentation than like a typical buyer would have in any scenario. Sure. You know? I had all the invoices from all of his rehab and well, that's cool.

SPEAKER_02 19:31

I mean, it's awesome that it paid that it paid off for you. And I mean that that must have been quite the feeling of just like, well, here we go, you know?

SPEAKER_00 19:37

It's like Yeah, and technically I've I got like paid to buy that property because I uh a couple years later ended up pulling some more cash out of it as things kind of values crept up after the uh part of the pandemic. So yeah, I have definitely negative uh cash in that, and it does cash flow, and I get the depreciation and everything else. And from there, I really just uh to simplify things, I just tried to go after the same type of property in the same neighborhood. Um because it's like we can kind of understand the everything about that building and and what it's worth and what it'll rent for, and cool.

SPEAKER_03 20:14

Did your experience buying this property and your other properties after that has that influenced any aspects of your loan officer position? Like in terms of how you think about loans and helping others?

SPEAKER_00 20:27

Yeah, I mean it gave me a real like inside look at the psyche of somebody who's like really backed into a corner, uh, almost no fault of their own. You know? So from like interacting with seller, and I guess interacting with client respect too, you you kind of gotta think of things this way is like, hey, what's the heartbeat of this deal? You know, it's not always like the price, it's not always the rate down to the eighth, the the origination fee down to the eighth. A lot of times it's it's something else, it might be something more emotional, it could be timing, it could just be responsiveness. Um, so I guess what I learned is like figure out you know the heartbeat of the deal. Gotcha. Let's get informative.

SPEAKER_02 21:10

Okay, so we've got a lot of people out there, and that was a bad segue, but let's got a lot of people out there that are listening to the show that you know we might have had it in the description or maybe we'll put it on social media. Um, but one thing specifically that is a big part of a part of your role is D DSCR loans. So getting really like basic with it. I for listeners who might be new, people you know what exactly is a DSCR loan and why do you think that it's become so popular with with investors right now?

SPEAKER_00 21:40

So it's in the name, you know, DSCR stands for debt service coverage ratio. In other words, like what's the ratio at which uh you know you're covering the debt on this property every month? The easiest way to think about it would be a 1.0 is break-even. It means that the rent, in our case, it means the rent is equal to the P I T I, the principal interest, taxes, and insurance on the loan. So you don't really want to be at a 1.0, right? But it but it is a very helpful qualifying tool. And perhaps that's because in the real world it's not a 1.0. In the real world, you'll get higher rents in the near future or something like that, right? But these are an absolutely crucial tool for anyone who expects to actually scale a rental portfolio because Fannie and Freddie or conventional loans just have uh guardrails at a certain point that are gonna really limit your ability to do that. So the big thing about DSCR loans and why they're even looking at the subject property's DSCR is that they're not looking at your DTI. So we're not looking at tax returns, we're not looking at pay stubs, um, or even trying to quantify your debt-to-income ratio at all. Uh we're just concerned that the subject property can cover its own debt. We rely on FICO, uh, you know, that's that's still very important. Uh these do allow LLC vesting. In some states, they'll even require it, but we still require one guarantor, someone who's gonna have their at least one guarantor, whose credit is gonna be relied upon, who owns at least 20% of said LLC. But uh the reason I say it's so crucial to scaling is is for a couple reasons. One, most people's DTI can't support, you know, more than like maybe a couple mortgages, you know? Two, Fannie and Freddie actually cap you at 10 investment pro 10 financed properties uh no matter what, and most lenders have overlays to cap you beneath that. And then the other thing would be like speed of scale. And I'd say this this might be like the number one use or or marketable factor about DSCR loans is doing cash out refines with little to no title seasoning. So sometime in like May 2023 or so, um conventional lenders change their guidelines to require now 12 months of title seasoning when there's a first position lien on the property, which is most deals, unless you bought it cash, right? Most deals are doing some kind of hard money loan or fix and flip style loan on the front end to buy the distressed property, fix it up, and then they're coming in for a DSCR loan to refi because we'll use that new appraised value to calculate your loan amount without title C saying. Oh, we would we do want to see, like, hey, why did it appraise for so much more than you bought it 90 days ago? And that's as simple as you submitting your scope of work to us and allowing us to just connect the dots there that you made physical improvements.

SPEAKER_02 24:30

So do you think that it is basically that flexibility, that that kind of you know, the way that maybe that you might be able to drive things a little bit higher, like maybe do a little bit more with what you have being what why it's becoming so popular with you know with investors these days.

SPEAKER_00 24:46

Yeah, it's it's definitely the easy button, right? Yeah, I mean, even even me, like I actually got a lot of flack from um people in my cohort in the mortgage industry, and that when they didn't quite understand it at first why I was using DSCR lens on my own personal investments, they're like, You you qualify for the the bank rate, let's go get you a full dock. I'm like, dude, I'm trying to get this thing closed like without any question now, you know? And so it's a much simpler process. And what's crazy is that the industry has become so competitive, there's so much capital chasing too few of deals that nowadays the delta between conventional rate and DSCR rate is small if if at all. There are some scenarios in which um the top DSCR lenders might even price inside of Fannie and Freddie on certain scenarios, namely like max LTV cash outs on two to four units or stuff like that.

SPEAKER_02 25:40

Okay. Patrick, I don't know about you, but I've heard the name Fannie and Freddie a few times, and I'm wondering, I'm like, they sound like they're good bigger pockets users too. I was like, we have to get their contact information.

SPEAKER_00 25:50

Yeah, so Fannie and Freddie are the uh or Fannie Mae and and and Freddie Mac.

unknown 25:55

Okay.

SPEAKER_00 25:56

They are uh government-sponsored entities, the GSEs, basically the federal government backstopping mortgages. And this came um into place after the financial crisis, you know, as a way to uh stabilize the mortgage industry and and create very strict rules of underwriting to prove that the borrowers have the personal ability to repay the loan.

SPEAKER_01 26:20

Okay.

SPEAKER_00 26:20

On in my world, DSCR loans, we are not trying to prove that the borrower has a personal ability to repay the loan. We're trying to, you know, sell as many loans as possible, and and the underwriting is much better than back then, right? Because we have much more strict requirements on FICO, reserves, um, in some cases, experience, and and namely just you know, we kind of work hard through multiple sources to prove that the DSCR really is strong on this property.

SPEAKER_02 26:45

Okay. Patrick, you gave me a we a weird look when I asked that question. Did you know what that was?

SPEAKER_00 26:50

Or it wasn't I was trying to use context clues. Okay, when I say Fanny and Freddie, what I mean is conventional. What I mean is that's the first one.

SPEAKER_03 26:59

That's kind of what I figured.

SPEAKER_00 27:00

Yeah. What what I mean is they have certain federal guidelines that you cannot get around. Whereas with this, that we are not supported by the federal government, GSCs, or anything like that. We're supported by hedge funds, life insurance companies, large private investors, entities that would want to purchase this paper on the secondary market.

SPEAKER_01 27:20

Yeah, very good.

SPEAKER_03 27:21

And so for like let's say for the average for the average home buyer, let's say, do you pretty much in most cases do you recommend DSCR loans? Uh like do you do you feel that it's beneficial, you know, let's say nine nine times out of ten or something like that? Or like what what specific instances would you uh would you say that one is better than the other?

SPEAKER_00 27:43

Yeah, I mean, it's hard to say. Like I'm I'm leaning more towards saying, yeah, there are scenarios on a turnkey rental property, cookie cutter deal when you have a great W-2 borrower who's not interested in investing title in an entity, just using their personal name. Yeah, you I'd encourage you to shop a conventional lender and see what they're coming back with. There's a chance you stand you stand to benefit a couple basis points on your rate. Might not be as much as you expect compared to the DSCR loan, but but surely. Yeah. Okay.

unknown 28:13

Yeah.

SPEAKER_00 28:14

Cool.

SPEAKER_02 28:14

We're I've got a couple not necessarily rapid-fired questions, but I do want to touch on you as an investor. So, like from your from your experience, I mean, what's the number one thing that investors can do to make themselves more attractive to lenders?

SPEAKER_00 28:27

Yeah, great question. You know, being easier to work with on my end means like you don't have to know everything. I'm here to answer your questions, you know. But but strong communication skills. Like, I highly recommend that investors start kind of setting up some type of work drive folder if you use Google Drive or or whatever you like to use and store certain documents in there that are like ready to go. Like driver's license, um, if you have if you already own properties, like schedule of real estate. You're if you're using an LLC, have the entity docs ready to go, the basics, like your articles of organization, operating agreement, EIN letter. And then if it was a recent, like if you're coming to me for a refi, which is most people, like I'd say like the lion's share of my deals are refines on recently renovated properties. Okay. And people like that, I say you should really have your scope of work dialed in. Like whatever you did to this property recently, have a beautiful one pager that just lays it all out. Not just for me and the underwriter, we're kind of barely gonna look at it, but really for the appraiser. Right? I really want you to have the best chance of success. So I I make the more I loan you, the more money that I make, you know. So it's it's never like I'm like uh wanting that to come in low, but to one thing you can do to set yourself up for success is have a one pager put together of your recently completed renovations and perhaps maybe some before and after photos. Another thing to avoid appraisal surprises would be just really having a good grip on your comps to begin with. You know, I a lot of investors I ask them, okay, great, what what do you expect this appraisal to come back with? So we can you know size up the initial quotes and they go, well, Zillow's got this and Redfin's got that. And hey, sometimes is that reasonable? Yeah, most of the time, no. You know what I what I'd much rather you do is contact a local agent or broker and request a comparative market analysis or a CMA. It takes them all five minutes to set some filters and run a search and print you out a nice PDF that says, hey, here's the most similar comps that sold within a half a mile in the last six months. Sure.

SPEAKER_02 30:26

I love the practicality of your first tip being organize yourself basically, like get your like Google Drive or like your on like your all of your stuff in the right format. You speak that as if you've run into situations where disorganization can cause chaos.

SPEAKER_00 30:40

Yeah, it it I mean it does. You know, there's there's a big difference between the client who has everything kind of signed, still, and deliver and the one who's got no subject line and just says something like, What are your rates in terms? Well, there you should see how complicated this rate sheet is, right? There's adjustments for everything, right? Every 20 points in FICO or so, the LTV, this the specific DSCR ratio, the loan amount, this location, the unit count, all types of things that can affect the rate. And actually, we built out a pretty cool pricing engine for this product. We can maybe plug in the show notes or something, but I created a really cool tool and we're spending a lot of time on it every week to make it bigger and better and eventually become something I think is like industry leading. But right now it's it's a very simple widget where you can go in there and punch a few details in on your scenario, like whether it's a purchase or a refi, what's the value, what's the rent, what's your estimated FICO score, annual taxes, annual insurance, so that I can calculate the DSCR. And as soon as you've entered those figures, boom, instantly you're gonna get dialed in rates and terms, fees, loan amount, monthly payments. And even if you're not trying to start a loan application with me, I highly encourage you to play with it because I think it will actually really help you size up your deals. Like when I was first analyzing deals to purchase on my end, the cheat code that I had was like all these wholesale broker portals where I kind of worked it from the angle of the loan to begin with. It was kind of like, okay, how will this loan work? So I kind of what I intended to do was really like give that to the borrower in a really digestible way that's easy on the eyes and comprehensible. And the other thing is like a lot of our industry is so archaic where this this kind of this whole conversation is like, you know, kind of whining and dining you on the phone and asking for documents and telling you we'll get we'll get back to you later. Whereas this is like, hey, this is exactly what it is based on what you're telling us. And if you'd like to proceed, you know, click the next button and we'll start working on reaching out to you and collecting some stuff.

SPEAKER_02 32:40

Yeah, that is cool. We'll definitely have to link to some stuff. So it's like a website that you built or a wit like a widget on the website.

SPEAKER_00 32:46

Yeah, it's actually just like a it's like a widget on our website. Yeah. So it's it's investorpropertyloan.com slash DSCR.

SPEAKER_02 32:53

Okay. Sounds like a super useful tool. I I'm definitely gonna mess around with it because I'm in the I'm in the market to start looking at homes in the next year, so whatever, but it's like, you know, you kind of play around with those kind of tools. It's always cool to see what you can find online and see. Yeah, if nothing else, it just gives you like some flavor for like where rates are at too. Sure. So in terms of rates and and like the the condition of the market right now, but we've you know, we've asked a couple people that we've had on as guests, but I'm curious to hear your perspective. How have lending conditions shifted in the last year and what should investors expect going into 2026?

SPEAKER_00 33:24

I mean, I'd say in in general this year we had a lot of rate improvement. You know, we had very good volume on this side of things. I think um, you know, as a small company, we uh originated more than$100 billion worth of loans this year already. Much more than$100. Um, probably a little bit more than$150, uh, which is a lot of for a group of like six or seven loan officers, right? Um right now, the average rate for a DSCR loan, and I'm gonna assume a few things here, like average FICO range and maximum LT and maximum LTV, somewhere in the mid-sixes. And uh that's up a little bit from a few weeks ago pre-Fed rate announcement. These Federate announcements really throw the average person through a loop with with what to expect with mortgage rates because largely these announcements are telegraphed, right? Wall Street and the secondary market knows exactly what Jerome Powell's about to say. Well, they know they know how what he's gonna reduce the rate by. And that's largely baked into the pricing pre-announcement in the lead up. Um, but in this specific case, you know, he lowered the interest rate a little bit, the federal funds rate a little bit, which does not control mortgage rates. It's the overnight lending rate from one bank to another. But in his speech, you know, he has he was kind of had some damning words about the economy, really questioned his decision to lower rates, basically said that the next announce the next uh meeting, it's it's not promised that there'll be another drop. And all of this kind of like negative language caused the five and ten year treasuries to actually go up a little bit. So, contrary to what everyone was ex the average person was expecting, right, um after that Fed rate cut, most recently, mortgage rates actually went up. They're more in line with mortgage rates are more in line with the five and ten year uh treasury yields. Okay.

unknown 35:14

Yeah.

SPEAKER_00 35:14

So some signs of positivity. Some signs of positivity, but what I would actually uh the my my main point here is to not worry about it too much, to be honest with you. I I really I really think I really think that things are gonna be sticky for a long time. I expect 2026 to be a fairly flat, you know, lake water type of year for rates. Are things gonna go up a little bit and down a little bit and up a little bit and down a little bit? Sure. But if you're really like stopping yourself from doing a deal over like an eighth or a quarter in rate, um I think it's largely wasted time. I think that when you're underwriting these deals, as a matter of fact, you ought to just try to make all of these work at a hundred bips higher than what you think the rate's gonna be, you know, rather than relying on uh it needing to be lower, right? Because here's the thing real estate, it's really all about like time in the saddle or like time, you know, I think I'm thinking like workout, uh puntering out, like time and retention, you know, like you you can you can make moves as rates fluctuate over time, but I just wouldn't I wouldn't stop yourself from getting into a deal that works today at the current rate or at a rate that's slightly higher than the current rate because you think rates might come down in six months. I just been I've been watching people play that game for years and years, right? They they were they think rates are coming down in six months, and maybe they are, maybe they're not, but yeah.

SPEAKER_02 36:35

Yeah, one of the one of the most interesting things uh, and you know, we've been doing the podcast for like probably around a year, maybe a little less then. But every almost every interviewee we've ever had on the show, when we've asked about like basic advice for people like looking to jump into the real estate industry, everyone kind of just says like the waiting for the right time thing is just kind of like not the way that it works. Like you kind of just have to take that plunge and jump.

SPEAKER_00 36:59

You heard my story. Sure. Yeah, I mean, I I I jumped in like not just I mean, I jumped head first. That's putting it mildly, right? Yeah, exactly.

unknown 37:11

Yeah, exactly.

SPEAKER_02 37:12

That's cool. But so I do want to ask a couple, like some quick fires. Again, I've got a couple more questions. What is some of your favorite real estate books or podcasts, like uh, you know, obviously besides our show that that you might recommend to people, like besides like, you know, we talked a lot about bigger pockets, but are there any other great real estate resources that you would recommend to people?

SPEAKER_00 37:33

Yeah, I mean, you know, one that I listen to how as often as they put it out, which is a couple times a week, is an offshoot of the Bigger Pockets podcast. It's a lot of like the core guys, but uh it's called On the Market with Dave Meyer. And uh usually they run kind of a panel where Dave is like the big data guy and can run you through a lot of like local and nationwide data in terms of like what's going on in the housing market. And then the other bit of the round table are investors, um, one of which is a friend and client of mine, Henry. Yeah, that's a great show because they're very short episodes, usually they're less than an hour, like 30 to 40 minutes, and they're very uh topical. So a lot of times it's about what's been going on in the last few days that may move the needle for investors.

SPEAKER_01 38:16

Okay, cool.

SPEAKER_03 38:17

Patrick, you got anything else? My one question, circling back a little bit, but I'm just kind of curious because uh Zach and I are both in a position, we're like learning about real estate. We still have yet to to buy our first property. And so I think a lot of our uh our angles at things are about buying that first property. From a loan perspective, what's the biggest difference between getting that first property and then getting that second property? Because that's something that we haven't talked a ton about in the past. Because, like, from my point of view, it's like, yeah, you save up, you save up, you get the down payment on the first property, you got a loan. But like the second property seems kind of like a like science fiction at this point to us because we don't even have the first one, but it might be good to like know about that and plan ahead a little bit. So, just any any thoughts on that?

SPEAKER_00 39:05

Yeah, I mean, short of you guys just having like bucko crazy income, you know, it's gonna be very hard to like buy one turnkey rental property with 20% down and then save up another 20% and do it again. Like, that's kind of crazy. So, like what I've done with my limited amount of cash on hand is employ a strategy which is going to limit my amount of cash in every deal, thereby allowing me to do more deals. And that's really the Burr strategy or the fix and hold strategy. Burr stands for you know buy, renovate, rent out, refinance. And in doing this, you're usually dealing with lower down payment because like on our end, we can do this with you know 10% down, where we're funding 90% of the purchase price and 100% of the rehab with no prepayment penalty. You force the value up through your renovations, and hopefully you're able to do a cash out refire where you get all or most of that initial cash to close back. That way, hey, now you have a cash-flowing rental property, you have almost you know, you have the same or almost the amount of cash you started with, and go do it again. You know, it that's a very oversimplified view of it, but and then once you develop experience, like I really don't recommend this to first-time investors, but what I will say is that once you've built a track record of doing that a few times, like I have, you would be surprised how many people would be interested in private lending relationships. So, like after I did that, you know, seven, eight times or whatever, I was able to do the the next few deals with true private money, where you know, I'm going to an individual with a large self-directed retirement account and I'm explaining the deal and where their loan amount would be relative to the after repair value. And hey, here's why it's so similar to the other deals I've done. And yeah, now I can get like 100% financing on the front end.

SPEAKER_02 40:53

Got it. So smart strategies, Patrick. It sounds like that's smart strategies. Strategy. Learning the acronyms.

SPEAKER_00 41:00

Yeah, learning the acronyms, yeah. Yeah. LTV, DSCR, and Burr are a couple good ones.

SPEAKER_03 41:06

So it is called Burr because we've talked about that term like way in the past. And we didn't, or like B R like we weren't sure how to put that. It's kind of a mouthful, yes.

SPEAKER_00 41:19

Yeah, and I'm actually I'm on if you're if you um if anyone's on Instagram, I'm actually it's just my name, Alex Bakiza, the Burr Lender. Okay. Yeah, because I I can kind of help on both sides of that, right? I can I can help with the hard money loan to buy the distressed property. Um, and then of course the DSCR refi.

SPEAKER_02 41:38

Did you check and see if at Burlender just that was available?

SPEAKER_00 41:42

The Burrlender? I don't remember it. I've had that tag for a long time now, like probably almost a decade, but like, yeah, I think uh there were there were a couple domains that I was ups upset about being taken already, but I doubt they're even still being used because I don't know who they are. Like Berlones or Burlender or something more simple.

SPEAKER_01 41:57

Yeah.

SPEAKER_00 41:58

Here's the other thing. Loan officers kind of like unfortunately carry this uh stigma sort of of being like in the same vein as like used car salesmen, I feel like sometimes. So like I just feel like a lot of times people have their guard up already, and it's nice to have the ability to have one unique name. So like they they Google it quickly, the Instagram comes up. Yeah, it's a lot of loan stuff, but it's mainly actually just personal stuff. So it kind of like I just wanted to reflect hey, this is an actual human, right? Not some kind of shady guy.

SPEAKER_02 42:27

Yeah, the loan officer of the people. Yeah, exactly.

SPEAKER_00 42:30

The people's loan officer. There you go. Then I have to change the name to that.

SPEAKER_02 42:35

No, you should absolutely check and see if at the Burrlander is available because that's a that's a sweet tag. But uh no. All right, well, tell the people where they can find you. I mean, you've already given out your Instagram handle. We've we've heard a couple resources here, but like tell the tell the listeners, you know, what you know, your resources online, where to find you. Basically, this is your chance to kind of just plug away for a second.

SPEAKER_00 42:55

Uh yeah, so uh easiest place to find me would be uh either Instagram or bigger pockets. Um very simple, just my name and Instagram, the Burlender, and then our website, investorpropertyloan.com slash DSCR. I kind of run point guard on all those submissions that come through. So if you simply use that tool, uh it will ping me and I'll be reaching out to you.

SPEAKER_01 43:15

Okay.

SPEAKER_00 43:16

That's awesome.

SPEAKER_02 43:17

Well, thank you, Alex, for being on the show. It was enlightening. It was a pleasure to get to hear about your story and to listen to you talk. And uh, you've educated Patrick and I Patrick. Do you feel educated?

SPEAKER_03 43:28

I feel so educated. I know so much now. Well, it's been insightful.

SPEAKER_00 43:34

Yeah, and and for your own investing sake, if you forgot to ask something, you guys have my cell phone, you let me know. Sure.

SPEAKER_02 43:40

And we'd love to have you back on the podcast anytime you feel like it. And uh yeah, I'm sure one of these days we'll have you on to kind of pick your brain a little bit more about what's going on in the world.

SPEAKER_00 43:48

All right, that sounds great, guys. Thank you.

SPEAKER_02 43:50

Okay, cool, awesome, Alex. So thanks all again. All right, thank you, Alex, for joining us. That was a great interview. Patrick, did you learn a lot? I learned so much. Yeah, you look it. And uh, we've been uh excellent uh having a oh damn it, that was really funny too. Shit. All right. All right, and we're back. Alex again, thank you so much for speaking with us today. It was awesome to hear from him. And uh I think on this beautiful Monday, we both learned a lot, wouldn't you say?

SPEAKER_03 44:23

I learned a lot, yes. It's cool. I know all about Burr now. And I'm a lone expert, some might say.

SPEAKER_02 44:30

Well, let's not get carried away. You still should consult with the experts, but thank you for listening to this episode of the Rentish Pod. Uh remember to follow us on all of your podcast platforms of choice out there, Spotify, Apple Podcasts, Overcast, wherever you get your shows, check us out and give us a rating, thumbs up, five-star review, leave us a comment, tell us how much you like the show, share it with a friend of yours that may be interested in real estate or property management, or it's just someone that wants to listen to a couple guys having a good time. And uh email your questions to questions at the rentichpod.com. And uh yeah, that I think that's about it. So until the next time that we see you guys, I've been Zach, that's been Patrick, and we'll see you next week. The Rentich Podcast is recorded in Cincinnati, Ohio, hosted by Patrick Giro and me, Zach Rotello. Produced by Mousse Gabri Mesquel and Charlene Mulchendani, edited by Elliot Mongenist. Theme song by me, Zach Rotello.