SFI Loans

DSCR Loans for Rental Properties

A DSCR loan qualifies you on your rental property's income instead of your personal income or tax returns, a 30-year loan built for buy-and-hold investors, not flippers. No W-2s, paystubs, or tax returns required.

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DSCR rental loan, at a glance

Typical terms on a 30-year rental loan

Loan-to-value75%–80%
Term30 years
Qualifies onProperty income + credit score
Tax returns requiredNo
Typical close~30 days

How does a DSCR loan work?

DSCR stands for debt service coverage ratio, the property's annual rental income divided by the sum of the annual mortgage payment, insurance, real estate tax, and any HOA dues. A ratio of 1.0 or greater is generally required, and the larger the ratio, the lower your interest rate will be. If the ratio comes in below 1.0, a smaller loan amount may be required instead. Your credit score also factors into the rate, and a lower loan-to-value brings the rate down further. That makes it a fit for investors who'd rather qualify on the property's numbers than on a stack of personal paperwork.

Investing in Texas or Colorado? See DSCR loans in Texas and DSCR loans in Colorado for local terms and the numbers to check before you offer.

DSCR loan vs. hard money loan: not the same thing

These two get lumped together often, but they're actually different products with different underwriting.

DSCR rental loanHard money loan
Term30 years6–12 months
Loan-to-value75%–80%80%–90%
Typical close~30 days1–2 weeks
Best forBuy-and-hold rentalsFix-and-flip

DSCR loan questions, answered

A DSCR loan, or debt service coverage ratio loan, qualifies you on the rental property's income instead of your personal income or tax returns. It is calculated as the property's annual rental income divided by the sum of its annual mortgage payment, insurance, real estate tax, and any HOA dues. SFI Loans' DSCR rental loans are 30-year terms at 75% to 80% loan-to-value, with no tax returns, W-2s, or paystubs required.

A DSCR loan is a 30-year rental loan underwritten differently from a hard money loan. It closes in about 30 days, carries a lower loan-to-value (75% to 80%, versus 80% to 90% on hard money), and is not generally considered hard money financing. Hard money is short-term fix-and-flip funding; a DSCR loan is a long-term hold loan.

SFI Loans qualifies DSCR rental loans based on the property's rental income and your credit score, with no tax returns, W-2s, or paystubs required. Loan-to-value is typically 75% to 80%, and a debt service coverage ratio of 1.0 or greater is generally required.

DSCR loan rates aren't a single fixed number. They depend on your debt service coverage ratio, your credit score, and your loan-to-value. A higher coverage ratio and a lower loan-to-value both bring the rate down.

Most DSCR rental loans close in about 30 days.

Yes, it's possible to purchase an investment property that needs to be rehabbed. However, a DSCR loan doesn't provide rehab funds, so you'd generally need to provide your own funds to fix up the property once the purchase closes. Most DSCR loans require a paying tenant in place within 90 days.

Ready to see what your rental property qualifies for?

Get prequalified before you make an offer, so financing is never the reason a deal falls through.

Get Prequalified
Call 719.602.3799
What type of loans do you provide?
We provide hard money loans for purchase and rehab of single family, 1-4 units, non-owner occupied properties.  We also provide 30 year loans for tenant occupied single family 1-4 unit properties. 719.602.3799

We provide mortgages to single family investors of all experience level from new investors buying their first property to experienced investors with hundreds of properties.

We currently provide purchase/rehab loans and rental loans in Texas, Colorado, Georgia, Florida, South Carolina, North Carolina, and Tennessee

Loan programs: Hard money loans in Colorado Springs · Hard money loans in Texas · DSCR loans · DSCR loans in Texas · DSCR loans in Colorado · Construction loans · What is a hard money loan?