DSCR Loans - For Investors
DSCR Loans: Explore Your Financing Options
A Debt Service Coverage Ratio (DSCR) loan is an investment property mortgage that borrowers qualify for based on the cash-flow of their rental property. By focusing on the rental income your property generates, DSCR loans remove the barriers that traditional investment property financing options pose, making it easier to scale your real estate portfolio!
DSCR loans offer a simple solution for investors to qualify for a real estate investment property by focusing on the property’s cash flow rather than the investor’s personal income. A Debt Service Coverage Ratio is used to determine the property’s ability to generate enough income to cover the monthly loan payments.
A DSCR greater than 1 indicates stronger cash flow, giving lenders the ability to offer more flexible guidelines like lower credit score and down payment requirements. DSCR loans can be an ideal option for both experienced and new investors.
What are the Requirements for a DSCR Loan?
There are no income requirements for DSCR loans. Instead, lenders use the estimated market rent for the intended investment property to determine if your expected rental income will cover your monthly loan payments. This is different from a traditional loan option that qualifies you based on employment and debt qualifications. DSCR loans are also sometimes referred to as business purpose or private lender loans.
- Down Payments as Low as 20%
- Up to 75% Cash-Out on Refinance
- Credit Scores as Low as 640
- Minimum Loan Amount $100k
- Maximum Loan Amount $2.5M
- Residential Properties Only
- No Limit on Total Properties Owned
- 1-4 Unit Properties
- 15, 30, & 40 Year Fixed Loan Terms
- 30 & 40 Year Interest-Only Loan Terms