A DSCR (Debt Service Coverage Ratio) loan qualifies you based on the rental income the property generates relative to its mortgage payment, rather than your personal income, tax returns, or employment history. It's one of the most popular tools for investors scaling a rental portfolio, especially self-employed investors or those with income that doesn't show well on paper.
Who it's for
- Real estate investors scaling a rental property portfolio
- Self-employed investors whose tax returns understate their real income
- Borrowers who've maxed out the number of financed properties allowed under conventional guidelines
- Investors purchasing through an LLC or other business entity
Key features
- Qualification based on the property's rental income vs. its debt payment — no tax returns or personal income verification required
- Available for purchase and refinance (rate-and-term or cash-out)
- Can typically close in the name of an LLC or business entity
- No limit on the number of financed properties in most cases
- Faster, simpler documentation than conventional investment loans
