Rental Loans
Whether this is your first rental or your hundredth, our DSCR rental loans make financing simple. Instead of diving deep into your personal finances, we focus on what really matters—the property’s income potential. That means no tax returns and no income verification, just a streamlined process designed to get you to closing fast. Skip the paperwork and start building your portfolio with confidence!
Program Terms
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Loan Amounts: $75K - $3.5M (Blanket Portfolio Loans up to $5M)
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Rates: Starting at 5.75%
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Geography: Nationwide (except North Dakota, South Dakota)
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Property Types: SFR, Condo, Townhomes, 2-10 units, Manufactured Houses(up to 65%LTV)
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Occupancy: Long-Term, Medium-Term, or Short-Term Rentals, Vacancy OK (on Acquisitions), no operating history required on STRs
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Loan Structure: 30-Year Fixed Rate Mortgage Loans, Flexible Prepayment Penalties, Partial IO (10-Years) Available, Entities (i.e. LLCs) and partners welcomed
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LTVs: Up to 85% (Acquisitions/Rate-Term Refinances), 80% (Cash-Out Refinances)
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DTI: Not Applicable (We don’t require tax returns or evaluate your personal income or finances when evaluating your application)
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No Minimum DSCR
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Credit Score: 640 minimum
Frequently Asked Questions
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What does DSCR stand for?
Debt Service Coverage Ratio. This is simply = your total payment / your total rents. If this number is 1.0 or greater, than your rents are higher than your total payment. The higher that is, the better your rate generally is.
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How do you calculate DSCR (Debt Service Coverage Ratio)?
The ratio is calculated by dividing the property income (rental income) from the property PITIA (principal + interest + taxes + property insurance+ homeowners association dues). The resulting ratio lets the lender know how much income is available to pay the mortgage. A ratio of 1.0x means that the property that the revenue from rental income AND expenses is equal. A DSCR above 1 means the property is positively cash-flowing. Conversely, a DSCR of less than one means that the expenses exceed the rental revenue and the property has a negative cash-flow.
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What are the advantages of a DSCR Loan vs. Conventional Financing?
There’s many reasons clients prefer DSCR loans vs. Conventional financing. First, DSCR loans do not take into account your other debts beyond the PITI payment of your loan. So, if you are self employed and report very little income, using a DSCR loan may be the best option.
Secondly, a DSCR loan does not report to credit, and therefore may not affect your future ability to qualify for additional properties.
Another benefit is that a DSCR loan allows you to vest in an LLC , whereas FNMA does not allow that on traditional financing.
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What are the top 3 factors for getting the best DSCR rates?
The top 3 factors that affect the DSCR rate include the actual Debt Service Coverage Ratio (DSCR), Loan-to-Value, and your FICO (credit score). The higher the DSCR is on a property, the lender is able to forecast a lower risk for lending the capital since the property may be positively cash-flowing and the investor is able to pay the monthly loan payments. Loan-to-Value, or LTV, refers to the loan amount as it relates to the actual value of the property. Typically, DSCR loans will never exceed 80% LTV. That means that the borrower needs to bring about 20% +closing costs as a down payment for the loan. The lower the LTV, the less risk for the lender, hence a better rate. Finally, your credit score is still a factor when determining the rate. Lenders use the score and it affects the final rate for your DSCR loan.
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What is the typical rate difference between DSCR and Conventional Financing
Rates vary daily, but typically DSCR loan rates can be lower than conventional, depending on leverage and credit. However, DSCR loans are much easier to qualify for given the fact they do not take into account your personal income.