LOAN PROGRAM OVERVIEW
DSCR Financing for Investment Properties
Debt Service Coverage Ratio
DSCR loans are designed specifically for real estate investors who want to qualify based on the performance of the property—not their personal income. Instead of relying on tax returns, W-2s, or employment history, these loans focus on whether the rental income from the property is sufficient to cover the mortgage payment. This makes DSCR financing an ideal solution for self-employed borrowers, full-time investors, or anyone looking to scale their portfolio without the limitations of traditional underwriting. Whether you’re purchasing or refinancing a rental property, DSCR loans offer a streamlined, flexible path to funding with fewer documentation requirements and faster closings.
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Qualify based on Property Cash Flow
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No Personal Income Verification
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Closings as fast as 21 days
No Ratio DSCR Options
Multiple Prepayment Options
Guidelines
Key factors to the approval of a DSCR Loan.
DSCR Ratio
Standard properties require a 1:1 ratio, with some programs offering no ratio programs.
Credit Score
Qualification usually starts at a 620 FICO score for investor products.
Down Payment
Minimum 15% down payment required for purchase transactions.
Property Type
Single-family homes, condos, townhomes, and 2-4 unit multi-family.
How to Calculate Your DSCR
Monthly Rental Income
Total monthly rental revenue from the property.
Monthly Debt Service
Total monthly housing payments (PITI).
Your DSCR
The core eligibility metric for your loan.
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Example: If annual rent is $2,000 and mortgage payments are $1,500, your DSCR is 1.33. A ratio over 1.00 indicates positive cash flow.
Long-Term Rentals (LTR)
A cornerstone of residential investment, LTR properties focus on stable tenant residency and consistent lease income typically with lease terms of 12 months. Methods to determine rental income for DSCR include.
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Active Lease Agreement + Proof of Deposit
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Projected Rent via Market Rent Appraisal
Best for: Conservative investors prioritizing steady equity growth and low turnover.
Long-Term vs. Short-Term Rentals
When calculating the DSCR for different investment styles, they are calculated differently. See below how we underwrite both Long Term & Short Term rental properties.
Short-Term Rentals (STR)
Tap into high-yield potential by hosting vacationers and travelers in short-term rental markets. Typical lease terms very anyway from nightly rentals to month to month.
- 12 Month History of STR Income Earned
- Projected Rent via STR Market Rent Appraisal
- AirDNA ProjectedGross Revenue
Best for: Growth-oriented investors looking for maximum yield in vacation destinations.