Investor Guide: DSCR Loan Guide

The Debt Service Coverage Ratio (DSCR) loan is a specialized lending product for real estate investors that qualifies a property based on its cash flow rather than the borrower's personal income.

How DSCR is Calculated

Lenders divide the monthly gross rental income by the monthly PITIA (Principal, Interest, Taxes, Insurance, and HOA fees). A ratio of 1.0 or higher means the property is covering its costs.

The Borrower Profile

While personal income is not verified (No DTI), lenders still review credit scores, liquidity for down payments and reserves, and your history as a real estate investor.

Typical Loan Terms

DSCR loans are typically 30-year fixed-rate mortgages. They offer LTVs up to 80% for purchases and refinances, with options for interest-only payments to maximize monthly cash flow.