DSCR Loans — 30-Year Rental Investment Financing Based on Property Cash Flow
DSCR loans (Debt Service Coverage Ratio loans) are a type of investment property mortgage that qualifies borrowers based on the rental income of the property rather than the investor's personal income. This makes DSCR loans one of the most powerful financing tools for real estate investors who are self-employed, have complex tax returns, or are building a large rental portfolio.
What Are DSCR Loans?
A DSCR loan is a non-QM (non-qualified mortgage) product specifically designed for investment properties. Instead of verifying W-2 income, tax returns, or employment history, the lender analyzes whether the property's rental income is sufficient to cover the loan's monthly debt service (principal, interest, taxes, and insurance).
DSCR is calculated by dividing the property's gross rental income by the total monthly debt service. A DSCR of 1.0 means the income exactly covers the debt service. Lenders typically require a minimum DSCR of 1.0–1.25, though some programs allow lower ratios for strong borrowers.
How DSCR Is Calculated
The DSCR formula is straightforward: DSCR = Gross Monthly Rental Income / Total Monthly Debt Service (PITIA). For example, if a property generates $2,500/month in rent and the total PITIA payment is $2,000/month, the DSCR is 1.25 — indicating the property produces 25% more income than needed to cover debt service.
-
DSCR above 1.25 — strong qualifying property
-
DSCR of 1.0–1.25 — standard qualifying range
-
DSCR below 1.0 — available with compensating factors in select programs
-
Rental income sourced from current lease or market rent appraisal
DSCR Loan Terms & Rates
-
Interest Rates: 5.5% – 8.5% (rate depends on LTV, DSCR, property type, credit)
-
30-year fixed-rate options available
-
5/1, 7/1, and 10/1 ARM products available
-
Interest-only options for qualifying borrowers
-
Loan amounts from $75,000 to $3M+
-
LTV up to 80% (purchase) and 75% (cash-out refinance)
-
No personal income verification required
-
No employment history required
Why Investors Use DSCR Financing
-
No income verification — qualify based on property cash flow, not W-2s
-
Self-employed friendly — no tax returns required for qualification
-
Scale your portfolio — add rentals without income constraints slowing you down
-
30-year fixed rates — lock in long-term stability for buy-and-hold investing
-
Competitive rates from 5.5% — better pricing than many hard money alternatives
-
Fast closings — streamlined process without income documentation delays
-
Short-term rental eligible — Airbnb and VRBO income considered in select markets
-
Cash-out refinance available — access equity in existing rentals
30-Year DSCR Refinance Loans
Our 30-year DSCR refinance program is one of the most popular products for investors who completed a fix-and-flip or used a bridge loan to acquire and stabilize a rental property. Once the property is leased, investors can refinance into a 30-year fixed DSCR loan — locking in a long-term rate, paying off the short-term bridge, and generating stable monthly cash flow.
This refinance-to-rent strategy — sometimes called BRRRR (Buy, Rehab, Rent, Refinance, Repeat) — is perfectly supported by our DSCR refinance program. We evaluate the stabilized rental income and structure a 30-year loan that maximizes your long-term cash flow.
DSCR Loans vs. Conventional Investment Mortgages
Conventional investment property mortgages from banks require extensive personal income documentation, strict DTI (debt-to-income) limits, and typically cap investors at 10 financed properties. DSCR loans have none of these restrictions — making them ideal for investors scaling a rental portfolio.
DSCR Loan FAQ
What is the minimum DSCR to qualify?
Most of our DSCR programs require a minimum DSCR of 1.0 or higher. We also offer programs for sub-1.0 DSCR properties with compensating factors such as strong borrower credit, low LTV, or significant equity. Contact our team to discuss your specific property.
Do DSCR loans require a credit check?
Yes — while we do not verify personal income, DSCR loans do review credit. Minimum credit score requirements vary by program, but we offer options for a range of credit profiles. Strong credit can unlock our best rates in the 5.5%–6.5% range.
Can I use a DSCR loan for short-term rentals?
Yes — we offer DSCR programs that consider short-term rental income from platforms like Airbnb and VRBO in qualifying markets. We use a combination of actual rental history and market rent analysis to determine qualifying income for short-term rental properties.