Discover the Debt Service Coverage Ratio (DSCR) Investor Loan

The DSCR Investor Program is designed for real estate investors purchasing or refinancing income-producing rental properties. Rather than qualifying based on personal income, borrowers qualify using the property’s cash flow through the Debt Service Coverage Ratio (DSCR).

DSCR is calculated by dividing the property’s monthly gross rental income by the property’s PITIA (Principal, Interest, Taxes, Insurance, and Association Dues, if applicable).

This program provides flexible financing solutions for both first-time and experienced investors seeking to grow or leverage their real estate portfolios.

Program Highlights

• Purchase and refinance options available
• Rate/term and cash-out refinance eligible
• No traditional income qualification
• No mortgage insurance required
• Multiple financed properties allowed
• 30-year fixed rate options
• Loan amounts from $100,000 to $1 million
• Maximum LTV up to 80%
• Minimum DSCR of 1.00
• Short-term rentals eligible
• Optional prepayment penalties available
• Escrow waiver options available
• Closing permitted in individual name

Eligible Property Types

• Single-family attached and detached homes
• 2–4 unit properties
• PUDs
• Condominiums

Rental Eligibility

• Long-term rentals
• Short-term rental properties

The DSCR Investor Program is available to:

• First-time and experienced real estate investors
• U.S. Citizens and Permanent Resident Aliens
• Borrowers with a minimum 700 FICO score
• Borrowers with at least two valid credit scores
• Borrowers financing investment properties only

Additional eligibility considerations:

• Credit events may be considered when seasoned 36+ months
• Gift funds from family members may be allowed
• Borrowers must sign a Certification of Business Purpose
• Borrowers must certify the property will not be owner-occupied

A DSCR loan may be a strong fit for borrowers who:

• Prefer to qualify using rental income instead of tax returns
• Own multiple investment properties
• Are self-employed or have complex income structures
• Want to expand a real estate investment portfolio
• Need flexible financing options for rental properties
• Are purchasing or refinancing short-term rental properties
• Want cash-out access from investment property equity

This program is ideal for buying a fixer upper, distressed property, or out of date home. It can also save the deal should major issues be uncovered during a home inspection. Rather than walk away from a home they love, home buyers can finance the purchase with an FHA 203(k) Renovation loan and have the funds needed to cover the cost of repairs.

Consumers may not be aware that renovation loans, including the FHA Standard 203(k) Renovation Loan, can also be used to refinance an existing mortgage. This can be an excellent alternative to a second mortgage or cash-out refinance when the funds will be used to repair or renovate the subject property.