Qualify on rent.
Not on tax returns.
DSCR (Debt Service Coverage Ratio) loans let real estate investors qualify based on a property's rental income. If the property's gross rent covers the monthly payment at the lender's required ratio, the deal qualifies — no W-2s, no two years of returns, no employment letters.
How DSCR works
The lender divides the property's monthly rent by the proposed loan payment (PITI). If the ratio meets the lender's minimum — usually 1.0 to 1.25 — the loan qualifies on the property itself.
That single shift unlocks financing for investors who have been pushed out of conventional lending: self-employed borrowers, 1099 earners, LLC owners, investors who've already hit Fannie/Freddie loan limits, and anyone whose tax returns show low adjusted gross income.
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Loan Payment (PITI)
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DSCR Ratio
Most DSCR lenders want 1.0 minimum. Strong cash-flowing deals price better at 1.2+. We'll tell you on the call which lender best fits your property's ratio.
Who DSCR is built for
- Buy-and-hold investors building rental portfolios
- Self-employed or 1099 borrowers with messy returns
- LLC borrowers (most DSCR programs accept entities)
- Investors at conventional loan cap (10+ financed properties)
- Landlords pulling cash-out for the next acquisition
- Long-term and short-term rental operators
Who DSCR isn't for
- Owner-occupied buyers (we do not lend on primary homes)
- Properties without rental income or projected market rent
- Properties below $100K loan amount
- Severely distressed properties (use fix & flip instead)
- Borrowers with very recent foreclosures or BKs (varies by lender)
Common DSCR terms
These are typical ranges across our lender network. Specific terms depend on property, ratio, credit, and lender.
Rates fluctuate with market conditions. We don't quote rates in evergreen content because by the time you read this they may have moved. On the discovery call, Randall will give you live ranges from the lenders that best fit your scenario.
To package a DSCR deal
- Property address and purchase contract (if buying)
- Estimated rent or current lease (for refis)
- Borrower entity info (LLC documents if applicable)
- Borrower credit (soft pull for evaluation)
- Estimated property taxes and insurance
- Estimated HOA dues, if applicable
- Recent bank statements showing reserves
- Real estate experience summary (informal is fine)
Have a rental in mind?
Bring the address and the numbers. 15 minutes and we'll tell you what's real.