DSCR Checklist for Submitting DSCR Loans: Everything Brokers Need to Know

If you’re preparing to submit a loan using a Debt Service Coverage Ratio (DSCR) structure, following the correct process is critical. This guide outlines the complete DSCR checklist for submitting DSCR loans, ensuring brokers and loan officers avoid common delays and compliance issues. Whether you’re submitting through Newrez or a non-Newrez lender, adhering to this checklist will keep your files moving smoothly through underwriting.

Required Documents for DSCR Submission

003 Form – Residential Loan Application

  • Must be signed and dated by the interviewer.
  • If the application was taken face-to-face, borrower signature is required.

Borrower Authorization Form

  • Mandatory if the 1003 is not signed.
  • Required upfront for borrowers residing in MS, NV, OR, or VT before the original credit pull.

Mortgage Broker Agreement

  • Must be included based on state-specific requirements.
  • Refer to the Wholesale Disclosure Signature Matrix.

Rate Lock or Float Agreement

  • Must be completed per state guidelines.

Purchase Agreements

  • Required for purchase transactions.

Investment Property Refinance

  • Provide current lease agreements.

Underwriting and Disclosure Documents

Loan Scorecard Findings

  • Must show “Pass,” or “UW review” with no missing data, or “Fail” with an approved exception.

Credit Report

  • Import and include the tri-merge credit report.

Homeownership Counseling List

  • Required for compliance.

Loan Estimates (LE)

  • All LEs issued to the borrower must be included.

Changed Circumstance Form

  • Must accompany any re-disclosed LE.

Settlement Services List

  • Include provider name, address, and phone number.

ARM and CHARM Booklets

  • Must be disclosed for ARM loans.

Home Loan Toolkit Delivery Proof

  • Required within three days of application for purchase loans.

Asset Documentation & Legal Disclosures

Asset Statements

  • Two months of bank statements for funds used at closing and reserves.

Patriot Act Disclosure

  • Must include borrower ID information and be signed by the ID verifier.

Appraisal & Property Docs

  • Appraisal report(s), condo questionnaire (if applicable), and proof of HOA dues.

Entity Closings

  • Provide:
    • Articles of Incorporation
    • Operating or Partnership Agreement
    • IRS Tax ID Certificate
    • Certificate of Good Standing

Anti-Steering Disclosure

  • For lender-paid loans only. Must show three loan options and be signed by the Loan Officer.

Letter of Explanation (LOE) for Recent Credit Inquiries

  • Must explain the purpose and outcome of each inquiry in the last 90 days.

Hazard and Flood Insurance (if applicable)

  • Provide proof of both.

Estimated Closing Agent Fee Sheet

  • Must detail all lender, broker, and escrow/title fees.

Preliminary Title Report

  • Include 24-month chain of title.

Intent to Proceed

  • Executed by all borrowers.
  • No REO documentation or income/employment documentation is required for DSCR loans.
  • Disclosures requiring signatures must be signed prior to submission, especially if the application was completed in person.
  • Refer to the Product Guide and AllRegs for further clarification on documentation requirements.

Additional Notes

  • No REO documentation or income/employment documentation is required for DSCR loans.
  • Disclosures requiring signatures must be signed prior to submission, especially if the application was completed in person.
  • Refer to the Product Guide and AllRegs for further clarification on documentation requirements.
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