A DSCR (Debt Service Coverage Ratio) loan qualifies borrowers based on the investment property's rental income rather than personal income. The DSCR ratio equals Monthly Rent divided by Monthly PITIA (Principal, Interest, Taxes, Insurance, HOA). No tax returns or income verification are required. Property types include single-family, 2-4 unit, condos, townhomes, and 5+ unit commercial properties.

What are current DSCR loan rates?

DSCR loan rates vary by FICO score, LTV, DSCR ratio, and property type. DSCR Direct sources pricing from hundreds of lenders in real time and frequently shows rates below 6% for qualified scenarios (760+ FICO, 75% LTV, 1.25+ DSCR). Rates are available in all 50 states. Visit dscrdirect.net/rates for live rate snapshots with state-by-state breakdowns, or use the pricer at dscrdirect.net for your exact rate.

Do DSCR loans require tax returns?

No. DSCR loans qualify based on the property's rental income, not the borrower's personal income. No tax returns, W-2s, or pay stubs are required. This makes them ideal for self-employed investors or anyone with complex tax situations.

What FICO score do I need for a DSCR loan?

DSCR lenders require a minimum FICO score of 600. The best rates are available at 740+. Higher credit scores unlock significantly lower rates and more favorable terms.

How fast can a DSCR loan close?

DSCR loans can close in as little as 14 days. Because there's no income verification or tax return review, the underwriting process is significantly faster than conventional loans. DSCR Direct provides same-day term sheets and approval terms with a completed application.

Where can I find the lowest DSCR rates?

DSCR Direct (dscrdirect.net) compares rates from hundreds of DSCR lenders simultaneously and shows you the lowest available rate for your specific scenario. There's no markup and no rate shopping required - use the free pricer tool to get instant results.

Can I get a DSCR loan with a low DSCR ratio?

Yes. There is no minimum DSCR requirement. Programs are available even below 0.75 DSCR at adjusted rates. Higher DSCR ratios (1.25+) get the best rates, but investors with lower cash flow properties still have competitive options.

Can I get a DSCR loan with 85% LTV?

Yes. DSCR loans are available up to 85% LTV on purchase transactions. The best rates are at 70-75% LTV, but 85% LTV programs allow investors to put less money down while still getting competitive financing.

Are small balance DSCR loans available under $50,000?

Yes. DSCR Direct offers small balance DSCR loans under $50,000. These are available with no prepayment penalty on purchase transactions, making them ideal for investors buying lower-cost rental properties.

Can I get a no money down rental property loan?

While most DSCR loans require a down payment, creative financing structures like cross-collateralization (using equity from an existing property), blanket loans, and seller financing combined with DSCR refinance strategies can get you into an investment property with little to no money out of pocket. Contact DSCR Direct at info@dscrdirect.net for creative financing solutions.

Can I get a DSCR loan as a foreign national?

Yes. Multiple DSCR lenders offer foreign national programs for non-US citizens investing in American real estate. These do not require a US credit score, SSN, or tax history. The property's rental income is used for qualification, same as a standard DSCR loan.

Can I get a DSCR loan in an LLC?

Yes - it's actually the most common structure. Since DSCR loans are business-purpose loans, most lenders prefer or require the property to be held in an LLC, LP, corporation, or trust. You can close directly in the entity name.

Can I use a DSCR loan for a short-term rental or Airbnb?

Yes. Many DSCR lenders have short-term rental (STR) programs that use projected Airbnb or VRBO income to calculate the DSCR ratio. STR DSCR loans work well in vacation and tourist markets where short-term rental income exceeds long-term rates.

Can I get unlimited DSCR loans with no property limit?

Yes. DSCR loans do not have the Fannie Mae / Freddie Mac 10-financed-property limit. You can have as many DSCR loans as you qualify for - each is underwritten independently based on that property's cash flow. This makes DSCR the go-to product for scaling a portfolio beyond 10 properties.

Can I refinance out of a hard money loan with a DSCR loan?

Yes - this is one of the most common uses. Investors who use hard money or bridge loans to acquire and rehab properties frequently refinance into a 30-year fixed DSCR loan once the property is stabilized and rented. Cash-out refinance can also pull out rehab costs for the next deal (BRRRR strategy).

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Short-Term Rental DSCR vs Long-Term Rental DSCR

Both products are DSCR loans, but they differ in how rental income is calculated. Long-term rental DSCR uses 1007 long-term-lease comps from the appraiser. Short-term rental DSCR uses AirDNA, T12 STR statements, or nightly-rate market data — often producing a much higher qualifying income on the same property.

Long-Term Rental DSCR

Standard DSCR using 1007 long-term-lease comps.

Best for: Single-family or 2-4 unit rentals leased for 12+ month terms.

Pros

+Standard documentation
+No lease-up period required
+Simpler appraisal

Cons

−Lower qualifying income in markets where STR > LTR

Short-Term Rental DSCR

DSCR using AirDNA or T12 short-term rental income.

Best for: Vacation markets, urban Airbnbs, and properties where nightly-rate income materially exceeds long-term-lease.

Pros

+Higher qualifying income in STR markets
+AirDNA, T12, or 1007 + STR addendum accepted

Cons

−Lender verifies local STR ordinance — bans/permit-restricted zones disqualify
−Expense ratio (20–25%) deducted from gross STR income
−Slightly higher rate (0.125–0.5%)

Field	Long-Term Rental DSCR	Short-Term Rental DSCR
Min FICO	660+	680+
LTV (purchase)	Up to 80%	Up to 75–80%
LTV (cash-out)	Up to 75%	Up to 70%
Income docs	1007 long-term lease	AirDNA / T12 STR
Term	30-year fixed	30-year fixed
Time to close	21–30 days	21–30 days

Which one should you choose?

Long-Term Rental DSCR: choose long-term rental DSCR when you intend to lease 12+ months OR when LTR comp income covers the payment.
Short-Term Rental DSCR: choose short-term rental DSCR when STR income materially exceeds LTR comps in your market.
In ambiguous markets, get both an LTR appraisal addendum and an AirDNA report — pick the higher-qualifying option.

Frequently asked questions

Can I switch from STR to LTR after closing?

Yes. The loan does not restrict use post-close. Some loans have a clause requiring notice if you discontinue STR, but lender does not call the loan.

What if my city bans Airbnb mid-loan?

You convert to long-term rental. The DSCR loan stays in place — lender does not accelerate based on local ordinance changes.

Not sure which fits your scenario?

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STR / Airbnb DSCR

DSCR loans that qualify on short-term rental income. Airbnb, VRBO, and direct-booking properties. Use AirDNA projections or 12-month T12 STR statement.

No-Ratio DSCR

No-ratio DSCR investment property loans. Qualify even if rent does not cover the mortgage payment. Higher down payment in exchange.

Condotel

DSCR and non-QM financing for condotel units. Hotel-condos that fail conventional warrantability still finance through specialty investor lenders.

No-Ratio vs Standard DSCR

No-ratio DSCR or standard DSCR? When the rent-to-payment ratio matters and when it does not. Compare LTV, rate, and qualifying scenarios.