ARIVE | New Required Field Announcement

New! | Required Field for ALL loans in ARIVE at the bottom of the Loan & Property screen

• If No: No other action would be required.
• If Yes: You will see a pop-up in ARIVE as well as an email with the following information as a reminder:

WHAT | Updated Requirements for all DSCR loans

Under Loan & Property, make sure the following are selected:

• Business Purpose Loan is CHECKED
• Alternate Doc Loan is CHECKED
• “Select Doc Type” drop-down is set to “DSCR - Debt-Service Coverage Ratio”

 If also a cash-out refinance DSCR loan, the following is also REQUIRED:

• Refinance Type is marked as Cash-Out from the drop-down
• The new “DSCR Business Purpose & Non-Owner Occupancy Certification” doc in ARIVE must be completed by all Borrowers (also available in our C2C Knowledgebase to send if the Borrower is unable to eSign)

HOW | New DSCR Tools for You!

We've also updated the DSCR How-To in the C2C Knowledge Base with the ARIVE setup requirements and step-by-step instructions. These tools are intended to make it easier to properly identify DSCR loans upfront and ensure the appropriate documentation is maintained in the file.

NEW Tools & Resources:

• DSCR Loan Set Up steps: Click Here 
• DSCR FAQ:  Click Here
• DSCR Doc Checklist:  Click Here 
• ARIVE Form | Business Purpose Letter:  Click Here

WHY | Message from Leadership

Every cash-out DSCR loan, regardless of state, must include a signed and dated letter from the borrower clearly stating the business purpose of the cash-out proceeds. This letter must be uploaded into ARIVE and included in the loan file.

Most lenders already require this, but it is imperative that we have documentation confirming the proceeds are being used for a legitimate business purpose. The Borrower needs to clearly explain the actual business purpose for the funds.

• The following statements or similar general language are not sufficient:
  • “Home remodeling”
  • “Paying off debt”
  • “Buying another house”

• The following would be more acceptable:
  • “Buying another investment property”
  • “Paying off business debt”
  • “Remodeling my investment property,” etc. 

California recently made it a felony for an Originator to originate a business-purpose loan when the proceeds are being used for non-business purposes or when the property is actually being used for a non-business purpose. This liability can also extend to Processors and LOAs as well, so it is very serious. Other states have also increased the criminal penalties associated with these violations, and we need to treat this issue seriously nationwide.

The same applies to occupancy. Do not use a DSCR loan on a Borrower’s primary residence. Find them a different product.

I had an LO ask me yesterday whether a Borrower could use a DSCR loan on a house he lives in because he occupies one room and rents out the others. The answer is no. If the borrower lives in the property as their residence, it is not an eligible DSCR business-purpose transaction. Misrepresenting the occupancy or purpose of the loan can constitute Occupancy fraud and can be a felony.

This portion of the compliance training specifically addressed cash-out loans and DSCR/business-purpose lending, and it applies to Loan Officers, LOAs, and Processors.

Effective September 11^th, 2026:

• Every cash-out DSCR loan must have a signed and dated business-purpose letter in ARIVE.
• The Borrower must clearly state the specific business use of the proceeds.
• DSCR loans cannot be used for a borrower’s primary residence.
• If the proceeds are not being used for a legitimate business purpose, we will decline the DSCR loan.
• We are applying this standard to all states, not just California.

Business purpose means business purpose.

If there is any question about the use of funds or occupancy, stop and get clarification before submitting the loan.

- Jeff Weller