The investor's guide to DSCR.
No fluff, no first-time-homebuyer hand-holding. Just how these loans work, the strategies that use them, and the math to size your own deal.
Strategies our clients run
Six ways investors use DSCR financing to grow faster.
The hard money exit
Your flip or bridge loan has a balloon coming. Refinance into a 30- or 40-year fixed DSCR loan — often with cash-out — before it's due. No seasoning required on the right program.
Quote this strategyBruised credit, real equity
A rough patch on your report doesn't end the deal. DSCR programs consider FICO from 450 and review recent mortgage lates case-by-case. We lead with the property, not your past.
See if you qualify40-year interest-only
Stretch amortization to 40 years and run interest-only for the first decade. The monthly payment drops, the DSCR climbs, and more rent stays in your pocket each month.
Run the numbersCash-out refinance
Equity trapped in a property does nothing. Pull up to 80% of value as liquidity and redeploy it into your next acquisition — without selling.
Quote a cash-outShort-term rental financing
Airbnb and VRBO income can qualify on the right DSCR programs — often using market or projected short-term rents. Finance the cash flow your property actually produces.
Finance an STRScaling a portfolio
Conventional financing caps you at ten properties. DSCR loans don't. Finance the fifth door and the fiftieth the same way — by the cash flow, one property at a time.
Scale upWhat a DSCR loan actually is
DSCR stands for Debt-Service Coverage Ratio. It's a single number that asks one question: does the rent cover the payment?
Instead of underwriting your personal income — W-2s, tax returns, debt-to-income — a DSCR lender underwrites the property's cash flow. If the rent covers the full mortgage payment, the deal works.
- 1.0x means rent exactly equals the payment.
- Above 1.0x the property cash-flows — lenders like this.
- Below 1.0x isn't a dead end — we lend down to a 0 DSCR on no-ratio programs.
Worked example, real numbers:
DSCR calculator
Plug in your numbers — this is exactly how we size a deal.
DSCR calculator
Estimate your debt-service coverage ratio in seconds.
For illustration only. Actual rate, payment, and qualifying terms are set at underwriting.
Investor loan glossary
- DSCR ratio
- Debt-Service Coverage Ratio — monthly rent divided by PITIA. The single number that decides whether the property qualifies.
- PITIA payment
- Principal, Interest, Taxes, Insurance, and Association dues — the full monthly housing payment your rent is measured against.
- LTV leverage
- Loan-to-Value — loan amount divided by property value. Purchases and rate/term refis go up to 85%; cash-out up to 80%.
- ARV value
- After-Repair Value — the appraised value once renovations are done. BRRRR cash-out is calculated against ARV, not your purchase price.
- Seasoning timing
- How long you must own a property before a cash-out refinance. Our DSCR programs can do zero seasoning — cash out right away — vs. conventional's 12 months.
- Prepay penalty
- A fee for paying the loan off early. DSCR loans typically offer 0, 1, 3, or 5-year options — shorter prepay, slightly higher rate.
- BRRRR strategy
- Buy, Rehab, Rent, Refinance, Repeat — the investor cycle DSCR cash-out refinances were built to fuel.
- Interest-only structure
- Pay only interest for a set period — usually the first 10 years — lowering the monthly payment and lifting cash flow and DSCR.
DSCR loan FAQ
Do I need tax returns or proof of income?
No. DSCR loans are qualified by the property's cash flow, not your personal income. No W-2s, no tax returns, no debt-to-income calculation. That's the whole point.
What DSCR do I need to qualify?
There's no hard minimum. A 1.0x ratio clears our standard programs, and we finance all the way down to a 0 DSCR — and even negative cash flow — on no-ratio programs. A 40-year interest-only structure can also lift a tight ratio.
How fast can you really close?
Most files close in 2–4 weeks with complete documents up front. The biggest variables are how quickly we get your statements and lease, and how fast the appraiser turns the property.
Can I close in an LLC, corporation, or trust?
Yes. Most of our clients vest in an LLC for liability and tax reasons. Corporation, trust, and individual (personal-name) vesting are all fine, and we can help move a property into an entity at closing.
What credit score do I need?
Guidelines are flexible — qualifying programs start at a 450 FICO. Higher scores unlock better rates and LTVs, and recent mortgage lates are reviewed case-by-case rather than auto-declined.
What's the seasoning requirement for cash-out?
None on the right program — we can do zero seasoning and cash out using current appraised value rather than your purchase price. That's why BRRRR investors come to us instead of waiting out a conventional lender's 12 months.
Is there a prepayment penalty?
Most DSCR programs offer 0, 1, 3, or 5-year prepay options. A shorter penalty period means a slightly higher rate — we'll quote every option so you can match it to your hold strategy.
What states do you lend in?
We arrange business-purpose investor loans in states that don't require licensing for that lending. Tell us where your property is and we'll confirm in seconds whether we can finance it.
Have the numbers? Let's price it.
Bring the property and the rent. We'll bring the lender and the rate.