DSCR Rental · Business-purpose
DSCR Rental Loans That Qualify on Property Cash Flow
REI Capital Consulting LLC is not a direct lender. Financing is provided by independent third-party lenders. Programs are subject to lender underwriting and approval.
Who this fits
- Landlords buying a rental that will lease at market rent
- Investors refinancing out of a short-term rehab or bridge loan
- Owners pulling cash out of a stabilized rental
- Self-employed investors whose tax returns understate income
- Portfolio owners, where portfolio programs are available
Usually not a fit
- A home you plan to live in
- Properties that need major renovation before they can be rented
- Rent that does not cover the full payment, taxes, and insurance
How it works
How dscr rental financing typically works
Rent
Market rent or the current lease is established, often by the appraiser.
Ratio
The lender divides rent by principal, interest, taxes, insurance, and dues.
Terms
Leverage and pricing depend on the ratio, credit, and loan-to-value.
Hold
Long-term amortization; interest-only options may be available.
What lenders typically review
- Market rent or lease
- Property taxes, insurance, and HOA dues
- Loan-to-value
- Credit score
- Reserves
- Property type and condition
Where it’s available
DSCR programs are offered in many states. The COGO Capital DSCR program referenced here is not currently available in Nevada, South Dakota, Utah, or Vermont. Other lenders may serve those markets.
Published lender examples
What one lender currently publishes
These are examples of parameters an independent lender publishes on its own website. They are not our terms, not offers, and they can change at any time. Final terms come only from the lender after underwriting.
| Published loan range | $75,000–$2 million |
|---|---|
| Credit | No published minimum; credit still affects terms |
| Loan-to-value | Up to 80% loan-to-value |
| Interest structure | Long-term; program-specific pricing |
| Property types | Non-owner-occupied rental property |
| Not available in | NV, SD, UT, VT |
| Also published | Approval based primarily on property cash flow |
| Also published | Cross-collateral allowed on two or more properties |
| Also published | Portfolio loans considered case by case |
Example of currently published lender parameters only. Not an offer or commitment to lend. Terms may change without notice and depend on lender underwriting, borrower and property eligibility, and geographic availability. Values described with “up to,” “may,” or “around” depend on lender underwriting.
Source: COGO Capital published program page. Information last reviewed .
Information last reviewed:
DSCR Rental questions
What is a DSCR loan?
A DSCR loan is long-term rental-property financing where qualification relies mainly on the property’s debt service coverage ratio: the rent divided by the monthly debt payment, including taxes, insurance, and association dues. A ratio above 1.0 means the rent covers the payment. Lenders still review credit, reserves, and the property, and the required ratio varies by program.
What DSCR do lenders require?
Requirements vary. Many programs look for a ratio of at least 1.0, meaning rent covers the full payment, and offer better terms at higher ratios. Some allow ratios below 1.0 with lower leverage or other conditions. Use real tax and insurance figures when you estimate, because those often lower the ratio more than expected.
Can I do a cash-out refinance with a DSCR loan?
Often, yes. DSCR programs commonly offer purchase, rate-and-term refinance, and cash-out refinance options. Cash-out amounts are limited by loan-to-value, the ratio, credit, and how long you have owned the property. Many investors use a DSCR cash-out to pay off a short-term rehab loan after the property is rented.
Are DSCR portfolio loans available?
Some lenders offer portfolio or blanket loans that finance several rentals together. One lender we reference publishes that cross-collateralization on two or more properties is allowed and that portfolio loans are considered case by case. Eligibility depends on the properties, their cash flow, and the lender.
Are owner-occupied properties eligible?
Generally, no. The programs described on this site are business-purpose loans for non-owner-occupied investment properties. If you plan to live in the property, including one unit of a small multifamily, you will usually need a consumer residential mortgage from a licensed mortgage lender instead. Tell us about the deal if you are unsure, and we will point you in the right direction.
Have a dscr rental deal?
Send the basic project details. We’ll review the scenario and identify potential next steps.
REI Capital Consulting LLC is not a direct lender. Financing is provided by independent third-party lenders. Programs are subject to lender underwriting and approval.