DSCR Loans for Investment Property
A DSCR loan qualifies you on the rent the property generates — not your W-2, tax returns, or personal income. Built for investors buying or refinancing rental property, with long-term, short-term (Airbnb), no-ratio, and portfolio options.
What is a DSCR loan?
DSCR stands for Debt Service Coverage Ratio — the property's gross monthly rent divided by its monthly housing payment (PITIA). A ratio of 1.0 means the rent exactly covers the mortgage.
Because the property qualifies the loan, DSCR lenders do not ask for your personal income, employment, or tax returns. They look at the rent (a lease, or a market rent analysis for short-term rentals), the property value, your credit, and your reserves. That makes DSCR the fastest path for investors who want to grow a portfolio without their personal debt-to-income ratio getting in the way.
DSCR loans are Non-QM, so they sit outside the Fannie/Freddie box. That flexibility comes with a trade-off: rates are typically a bit higher than conventional, and most lenders want a DSCR of 1.0 or above (1.20+ for the best terms). When a property does not quite reach 1.0, a no-ratio or asset-based program can still close the deal.
DSCR at a glance
DSCR loans: did you know?
A few facts that change how investors approach rental financing.
The 1.0 line
A DSCR of 1.0 means rent exactly covers PITIA. Below 1.0 the property loses money each month; above 1.0 it throws off cash flow. Most lenders set 1.0 as the floor and reward 1.20+ with better pricing.
Airbnb counts as income
Short-term rental DSCR uses a 12-month market rent analysis (AirDNA or similar) instead of a lease — so a strong Airbnb can qualify the same way a long-term rental does, often at 75% LTV.
No personal income verified
DSCR lenders never ask for pay stubs, W-2s, or tax returns. The property is the borrower's strength, which lets high-W2 earners and low-document investors alike qualify the same way.
No-ratio exists for tight deals
When the rent does not quite reach 1.0, a no-ratio DSCR qualifies on assets and property value instead — at a lower LTV (around 70%) and a slightly higher rate.
One loan, many properties
Portfolio DSCR loans bundle 2–10+ properties under a single mortgage with cross-collateralization, streamlining underwriting and letting you grow faster than loan-by-loan.
Close in an LLC
DSCR loans accept an LLC or individual as the borrower, so you can keep the investment property titled inside your LLC for liability protection.
DSCR Calculator
Enter the purchase price, rent, and costs. The calculator shows your DSCR ratio, monthly cash flow, and the largest loan a 1.0 DSCR supports at your rate.
DSCR Calculator
Debt Service Coverage Ratio = monthly rent ÷ PITIA (P&I + taxes + insurance + HOA). Lenders want 1.0 or higher.
DSCR Ratio
1.01
Meets the 1.0 minimum
Max loan at DSCR = 1.0
With this rent and rate, the largest loan a 1.0 DSCR supports is $283,175 — a max purchase price of $353,969.
Important Note
DSCR loans are Non-QM. No personal income or tax returns are used. LTV, reserves, and minimum DSCR vary by lender; many require 1.0–1.25.
Who a DSCR loan fits best
- Investors buying or refinancing a long-term rental (1–4 units).
- Investors financing a short-term rental (Airbnb, VRBO) with market rent data.
- Self-employed or high-W2 earners whose personal DTI limits conventional financing.
- Investors who want to close in an LLC and keep the property off personal income.
- Portfolio investors scaling multiple properties under one loan.
DSCR loan FAQ
Most lenders want 1.0 or higher — the rent covers the full monthly payment. A DSCR of 1.20 or above unlocks the best rates and terms. If a property sits below 1.0, a no-ratio or asset-based program can still work at a lower LTV.
Educational content only. This page is not financial, legal, or tax advice, a commitment to lend, or an offer of credit. Program requirements and terms vary by lender and change over time; figures cited reflect the sources below as of the dates noted, and eligibility always depends on your full financial profile. Liuver Duran, NMLS #2579601. Sociable Mortgage LLC, NMLS #2498240. Equal Housing Opportunity.
Sources
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