DSCR Loans

DSCR Loans

Overview

DSCR (Debt Service Coverage Ratio) loans are primarily for real estate investors who purchase rental properties. Rather than focusing on a borrower’s personal income, the lender evaluates whether the property’s expected rental income can cover the mortgage payment and associated property expenses.

Why an DSCR Loans

DSCR Loans can help real estate investors buy rental properties. These loans allow you to use the property's rental income for qualification instead of personal income. A down payment of 20-30% is typically required, making it a great option for investors who can’t provide traditional documentation.

For real estate investors
No personal income required
15% to 20% down payment
Flexible qualification criteria
Terms of 15, 20, and 30 years available

Danielle Damianov

NMLS#883539

Branch Manager

888-522-4149A
[email protected]

Who Qualifies?

Real estate investors looking to buy or refinance investment properties.
Borrowers who prefer the loan to be evaluated based on the property’s cash flow rather than their personal debt-to-income ratio.

Key Advantages

Cash-Flow-Based Qualification: If the rental income sufficiently covers the mortgage payment (and possibly a defined coverage threshold, e.g., 1.25x), you can qualify without proving personal employment income.
Unlimited Properties: Many DSCR loans allow you to finance multiple properties without the same restrictions typical of conventional lending.
Flexible Credit Score Requirements: Depending on the lender, DSCR loans can accommodate a range of credit profiles. 660 Is Usually required but some lenders may go down to a 640.

Jill Coss

NMLS#883539

Branch Manager

Schedule a Phone Call With Me

+1 949-791-7901

[email protected]

Apply Now

Example:

An investor wants to purchase a duplex that will rent for $2,000 a month. If the monthly mortgage payment (including principal, interest, taxes, and insurance) is $1,500, the DSCR is adequate (2,000 ÷ 1,500 = 1.33). This can help the borrower secure a DSCR loan based on the property’s cash flow rather than their personal income.