Do you have a borrower who wants to close a DSCR loan in an LLC? At North Star Mortgage Network, we make that possible—for all property types, including owner-occupied homes.

Whether your client is an investor or planning to live in the property, we allow LLC closings across all occupancies, as long as a few key requirements are met. Here’s everything you need to know to get started.

Why Close a DSCR Loan in an LLC?

For real estate investors, using an LLC for property ownership can offer:

  • Asset protection
  • Easier partnership structuring
  • Tax benefits
  • Streamlined property management

Many lenders restrict LLC ownership to investment-only deals—but at North Star Mortgage Network, we understand flexibility matters. That’s why we allow LLC closings for DSCR loans, even when the borrower plans to live in the home.

Documentation Requirements

To close in an LLC, you’ll need the following:

  • Articles of Organization
  • Operating Agreement
  • Unanimous Consent & Resolution to Borrow
    • Must include lender name, loan amount, and subject property address
  • SS-4 Form (or IRS equivalent showing the LLC’s federal tax ID number)
  • Certificate of Good Standing is not required if the LLC was formed within 60 days of the note

Additional Guidelines for DSCR LLC Loans

  • LLCs must be legally formed in the U.S.
  • Formation must be in the same state as the property unless registered properly in-state
  • Maximum of four members, all of whom must be natural persons
  • Members must be beneficial owners of the subject property
  • Operating agreement must define who is authorized to encumber the LLC
  • At least one member must qualify for and guarantee the loan
  • Borrowing applicants must own over 50% of the LLC collectively
  • Any non-borrowing members must sign the note and mortgage/deed of trust as LLC members

Don’t Forget: Assets and Reserves Still Matter

Even when using an LLC, the standard DSCR asset and reserve requirements still apply. Make sure the qualifying member(s) can meet those obligations to ensure a smooth closing.

Need Help?

If you or your client have questions about closing a DSCR loan in an LLC, I’m here to help. At North Star Mortgage Network, we guide you through every step with clarity, common sense, and full transparency.

Let us help you get the deal done—quickly and the right way.

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