Investors

Investment property and DSCR loans

Every financed property makes the next one harder to qualify for on personal income. DSCR programs look at the property’s own income instead.

Why investors hit a wall

Each financed property adds debt that lenders weigh against your personal income, so a portfolio that is performing well can still stop you from qualifying for the next purchase. Investor programs exist to solve that.

What DSCR means

DSCR stands for debt service coverage ratio: the monthly rent divided by the total monthly payment on the property (principal, interest, taxes, insurance and any HOA dues). Many DSCR programs look for 1.00 or higher, meaning the rent covers the payment. Minimums, reserves and down payment requirements vary by program. The rent figure comes from the lease if the property is already rented, or from the appraiser’s market-rent estimate if it isn’t.

The Rental DSCR calculator lets you test a property before you make an offer.

What DSCR lenders usually look at

  • The ratio itself, and how much room there is above the minimum
  • The down payment: investor loans typically require more down than a primary residence
  • Reserves after closing, and your credit
  • The property type: single-family, condo, 2–4 units, and whether it’s a short-term rental, which not every program allows

Holding title in an LLC

Many DSCR programs allow the loan to close in the name of an LLC, which conventional loans generally don’t. If that matters to how you hold your portfolio, say so at the start so we only look at lenders that allow it.

What it covers

  • Purchase. Financing for rentals, qualified on the property’s income rather than your tax returns.
  • Cash-out refinance. Pull equity out of an existing rental to fund the next one.
  • Conventional investor loans. When your personal income is strong, the conventional route may still be cheaper. I compare both and show you the difference.

What to have ready

  • The lease, or the appraiser’s market-rent estimate, for the property
  • A schedule of your current properties and loans
  • Statements for the down payment and reserves

Select programs for qualified borrowers. General information only; not a commitment to lend, a rate quote, or an offer of credit. Programs and terms are subject to change.

Related questions

Answered plainly.

Why use a mortgage broker instead of going directly to a bank?

A bank can only offer its own menu. As a broker I take one application and shop it across many wholesale lenders — including programs banks rarely carry, like bank statement loans, DSCR, and a wider jumbo shelf. After twenty years inside major banks, I also know exactly where they say no, and what to do about it.

Two lenders have already declined me. Is it worth trying again?

Often yes, but only if something actually changes. A decline is usually one lender’s guidelines rather than the whole market, so the first thing I want to see is the specific reason you were turned down. Sometimes the answer is a different lender, sometimes a different program, and sometimes it is ninety days and one thing fixed. I will tell you which one it is.

Other programs

Also worth a look.

Purchase & Refinance

Conventional

Learn more →

High-Cost Bay Area

Jumbo & Super-Jumbo

Learn more →

Second Lien

Home Equity & HELOC

Learn more →

Next step

Let’s talk through your scenario.

Tell me where you are: a house you’ve seen, a decline letter from a bank, or just a question. I’ll tell you plainly what’s possible and what it would take.

Start your application Contact Mehdi

Conversations available in English and Farsi. گفت‌وگو به زبان فارسی.