DSCR Loans

DSCR Loans

Mortgage Solutions

For Real Estate Investors

DSCR = Rental Income ÷ Mortgage Payment

What is a DSCR Loan?

A Debt-Service Coverage Ratio (DSCR) Loan

is a creative mortgage program designed specifically for real estate investors. Instead of requiring W-2s or tax returns, DSCR loans  qualify borrowers based on the cash flow of the investment property—not their personal income.


The DSCR Calculation Method

measures whether a property generates enough rental income to cover its mortgage payment. If the rental income is equal to  or greater than the mortgage payment, the borrower qualifies for financing.


This Makes Dscr Loans Ideal For Investors Who

  • Own multiple rental properties and want to avoid using personal income to qualify.
  • Are self-employed with complex tax returns that don’t reflect their true income.
  • Want to expand their real estate portfolio without hitting traditional lending limits.
  • Need a cash-out refinance to pull equity from investment properties for reinvestment.


 DSCR Loans vs Traditional Financing

Feature DSCR Loan Conventional Loan

Income Verification

Rental Income Only

W-2s, Tax Returns

Best For

Real Estate Investors

High-Income Earners

Max LTV

85%

75-80%

Debt-to-Income Ratio (DTI)

Not Required

Required Max 43%

Number of Financed Properties

No Limit

Typically Capped at 10

Max Loan Amount

$6,000,000

$806,500 - Varies Annually by County

How is DSCR Calculated?

A DSCR of 1.0 or higher - means the property’s income covers the mortgage.


Example -  If a rental property generates $3,000/month and the mortgage payment is $2,500/month, the DSCR is 1.2, which qualifies under most DSCR programs.


Debt Service Coverage Ratio as low as .80 may still qualify with additional reserves or a higher down payment.

What is the Minimum DSCR to Qualify? - Most lenders require a "One-To-One Ratio" or a minimum DSCR of 1.0, meaning the property must generate at least as much income as the monthly loan payment.


Low and No Ratio DSCR - Some programs allow DSCR below 1.0 with compensating factors like higher down payments, strong reserves, or higher credit scores. These can be .75 ratio DSCR loans or even no-Ratio DSCR loans meaning no requirement for rent to cover the mortgage payment.


Real Estate Investors –  Buy rental properties with no personal income verification.


Self-Employed Borrowers –  Use rental income instead of tax returns to qualify.


Multiple Property Owners –  No limit on the number of properties financed.


Short-Term & Long-Term Rental Owners –  Works for Airbnb, VRBO, and traditional rental properties.


Investors Looking for Cash-Out Refinancing –  Pull equity from properties to reinvest.


First-Time Investors –  Great option for those buying their first investment property without needing W-2 income verification.


DSCR Loan Program Details
Features Elite Loan DSCR

Loan Type 

DSCR Investor Loan

Best For 

Real Estate Investors, Multi-Property Owners, Short-Term Rentals

Max LTV 

85%

Min FICO Score 

660

Income Documentation 

Rental Income Only (No Tax Returns or W-2s)

Property Types 

Single-Family, Multi-Family, Short-Term Rentals, Commercial

Interest Only Option? 

✅ Yes

Cash Out Refinancing 

✅ Yes

Prepayment Penalty 

Varies by Loan Type
Debt Service Credit Ratio Loan Advantages
  • No Tax Returns or W-2s Required – Qualify using rental income alone.


  • Higher Loan-to-Value (LTV) – Up to 85% financing available.


  • Cash-Out Refinance Options – Use property equity for reinvestment.


  • Flexible Qualification – No personal DTI calculations required.


  • Great for Portfolio Investors – No limit on the number of financed
  • properties.


  • Works for Short-Term Rentals -  Airbnb, VRBO, etc.


  • Faster Approvals – Less documentation means quicker loan closings.


  • Interest-Only Payment Options – Lower monthly payments available.


Want to connect with a licensed

Non-QM Lender?

Have Questions? Contact us Today!

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Need a Conventional Lender?

Check Out These Other Resources

Frequently Asked DSCR Loan Questions-FAQ
  • What is the minimum DSCR to qualify?

    Some lenders can do .80 depending on the cirrcumstances. Most lenders require a minimum DSCR of 1.0, meaning the property’s income must cover at least the mortgage payment.

  • Do I need a high credit score for a DSCR loan?

    Most DSCR loans require a minimum FICO score of 660, but higher scores may qualify for better terms.

  • Can I use a DSCR loan for an Airbnb or VRBO property?

    Yes! Short-term rental properties qualify under most DSCR loan programs.

  • Do DSCR loans have prepayment penalties?

    Prepayment penalties vary by program and lender. Some DSCR loans have 3-year prepayment penalties, while others offer no prepayment penalties.

  • Are there DSCR loans with interest-only payments?

    Yes! Many DSCR loans offer interest-only payment options, reducing monthly mortgage payments.

Want to connect with a licensed

Non-QM Lender?

Have Questions? Contact us Today!

Contact Us

Need a Conventional Lender?

Check Out These Other Resources

Explore Your DSCR Lending Options

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