DSCR HELOC · low ratio financing
DSCR below 1.0? We can still get you a HELOC
A DSCR under 1.0 doesn’t stop us. At Andes Mortgage, we finance low-ratio and no-ratio investment properties every week — and before we ever call a property “below 1.0,” we check it two ways, because the property that fails on one calculation often clears 1.0 on the other.
Where it truly can’t, we have a program that skips the ratio entirely.
If a bank or another lender told you your rental doesn’t cover itself, don’t take that as the final answer. Let’s run your numbers the way an investor’s file should be run — and show you exactly what we can put together.
Edited by: Marcos Zambrano, President & Owner NMLS #988935 · Andes Mortgage LLC NMLS #2187991 · Updated July 20, 2026
How Your DSCR HELOC Amount Is Calculated
DSCR is simply the property’s gross rent divided by its housing expense:
DSCR = gross monthly rent ÷ monthly housing expense
A DSCR of 1.0 means rent exactly covers the payment. 0.90 means it covers 90% of it. It does not mean the property is a bad investment — it means it doesn’t clear a coverage test on its own, which changes how we structure your line, not whether we can get you one.
And here’s what most lenders won’t tell you: the number they hand you depends entirely on how they chose to calculate the payment. Change that one input and a “below 1.0” property can clear the bar. That’s the first thing we check.
A rental worth $500,000 with a $250,000 first mortgage, at a program allowing 70% CLTV:
$500,000 × 70% = $350,000 combined ceiling − $250,000 balance = ~$100,000 available line, before closing costs.
We’ll run the numbers for you: Take Mortgage Match and see how much HELOC you can qualify for.
First, we check whether you're actually below 1.0
DSCR compares rent to a payment — but which payment isn’t standardized. Some programs test against the fully amortizing payment (PITIA: principal, interest, taxes, insurance). Others test against the interest-only payment (ITIA), which drops the principal. On a low-ratio property, that single difference routinely crosses the 1.0 line — and we know which of our programs calculate it which way.
Here’s the same rental, renting for $2,400/month, run both ways:
The way a bank ran it (PITIA)
0.87
“Below 1.0.” Reduced line, higher reserves — or a flat decline.
The way we can run it (ITIA)
Clears 1.0. Full line for the program — same property, same rent.
This is the first thing we do for you
When you send us a property, we run it against the programs that calculate DSCR the most favorable defensible way for your file — not whichever one a single bank happens to use. If an interest-only draw gets you a full tier higher, that’s the structure we’ll build. Figures above are illustrative; your exact numbers depend on rate, taxes, and insurance.
If you're genuinely below 1.0, here's how we place it
If the property is truly under 1.0 even on the interest-only calculation, we don’t walk away — we place it in the tier that fits. The tier sets your maximum line and how much you’ll need in reserves.
DSCR ≧ 1.00
Full line for the program. Shown for reference — this is the tier we’re working to reach for you.
0.75 – 0.99
Line reduced, commonly by 5 to 15 points. The tier most of our low-ratio files land in.
Below 0.75
Line reduced further and more reserves required. This is usually where we reach for no-ratio instead.
A property at 0.95 gives up a few points of leverage. One at 0.70 gives up more and has to carry a year of reserves — which is exactly the point where our no-ratio program tends to beat it. More on that below.
Why a strong property still comes in below 1.0
In our experience, a low DSCR is rarely a bad property — it’s a timing or market mismatch. The ones we see most:
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Event
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Why it pushes DSCR down
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High-cost market
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Coastal and appreciation markets have low rent-to-price ratios — strong equity, thin monthly coverage
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Recent purchase at today's rates
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A payment set at current rates runs high relative to an existing lease
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Below-market rent
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A long-term tenant paying under market drags the rent figure down
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Insurance or tax spike
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Rising premiums in some states inflate the payment side faster than rent grows
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Short-term rental
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Gross rent is discounted 20%–25%, and the minimum DSCR is often raised to ~1.15
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Most of these we can work around — which is where the next part comes in.
How we get your property over the line
These are the moves we make on a low-ratio file, in rough order of least to most effort on your end:
Qualify on the interest only-payment
If a program tests on PITIA and an interest-only draw exists, we switch the calculation — and that alone can move you a full tier. No money down, no waiting. It's the first thing we try, every time.
Order a market rent appraisal (Form 1007)
If your lease is under market, we can use the appraiser's supported market rent instead — lifting your qualifying income without you touching the property.
Buy the rent down
Points lower the interest portion of the payment, which lifts your DSCR. On a property near the line, a modest buydown is often all it takes, and we'll show you whether the math is worth it.
Right-size the loan amount
A slightly smaller line means a smaller payment and a higher ratio — sometimes borrowing a touch less unlocks a much better tier on what you do borrow.
Structure your reserves
Reserves don't change your DSCR, but the lower tiers require more of them. We'll tell you upfront what you'll need on hand so there are no surprises at underwriting.
Move you to our no-ratio DSCR HELOC loan
When the ratio genuinely can't be fixed, we drop the DSCR test entirely. That's the next section — and it's a bigger part of what we do than most investors realize.
How soon after buying can you get a DSCR HELOC?
Most programs allow it soon after purchase, but recent ownership reduces your leverage. Seasoning is measured from the recording date to your application date.
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Ownership seasoning
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Effect on CLTV
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Under 6 months
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~10 points reduction
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6 months to 1 year
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~5 points reduction
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1 year or more
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No seasoning limitation
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If you bought recently and the reduced line doesn’t reach your target, waiting to the next seasoning threshold is often the single change that moves it.
DSCR HELOC on a short-term rental (Airbnb / VRBO)
Some properties won’t pencil to a workable DSCR no matter how we run them — a heavy value-add mid-renovation, a unit sitting between tenants, a short-term rental with lumpy income, or a market where almost nothing clears 1.0. For those, we place a no-ratio HELOC: the property’s cash flow drops out of the equation completely. There’s no DSCR to hit.
Instead of the property’s income, qualification rests on your credit, your equity, and your reserves. If those are strong, the rent almost stops mattering. This is one of the most useful tools we have for serious investors, and it’s the reason a “no” somewhere else is often a “yes” with us.
What you trade for it
No-ratio isn’t free leverage — it comes in around 10 points below the standard investment line, and it holds a higher credit and reserve bar.
But for a property that simply doesn’t cover itself on paper, a slightly smaller line you can actually close beats a bigger one you can’t. We’ll show you both numbers side by side so the choice is yours, not a guess.
Low ratio vs No-ratio DSCR - how we decide with you
Low tier DSCR HELOC
When we reach for it
- Property lands in the 0.75–0.99 range once we run it on interest-only
- A market-rent bump or small buydown can close the gap
- A market-rent bump or smYou want to keep every point of leverage availableall buydown can close the gap
- Rent is documentable and reasonably steady
No Ratio HELOC
When we reach for it
- DSCR stays below ~0.75 even on the interest-only calculation
- Income is hard to document — renovation, vacancy, new STR
- You have strong credit, equity, and reserves to lean on
- You'd rather trade ~10 points of line for a clean, fast close
Not sure which side you’re on? That’s exactly what we figure out on a five-minute call — and often we’ll quote both so you can see the trade in real numbers before you decide.
How do we put these numbers together? Our methodology
The ranges on this page reflect current wholesale guidelines across the multiple Non-QM and DSCR lenders we work with, reviewed as of July 2026. As a broker, we place your file with whichever of them fits it best — which is why we quote ranges here and your real number on a call.
We publish a figure only when two or more independent lender sources corroborate it, and we show it as a range rather than a single number. Individual programs land inside — and occasionally outside — every range shown. We don’t publish any one lender’s guidelines and we don’t name lenders.
- DSCR tier boundaries and line reductions are typical, not universal — lenders draw the lines differently
- Reserves are stated in months of PITIA on the subject property
- The ITIA vs. PITIA example is illustrative; your actual figures depend on rate, taxes, and insurance
- Everything here assumes an otherwise clean file with no recent credit events, and nothing on this page is a commitment to lend or a guarantee of approval
Program terms and eligibility vary by lender and are subject to change without notice. Figures shown are typical market ranges as of the date above, not a commitment to lend. DSCR and no-ratio HELOCs are business-purpose loans for investment properties. Andes Mortgage LLC, NMLS #2187991. Equal Housing Lender.
Frequently asked questions
Can I get a HELOC with a DSCR below 1.0?
Yes — we do it regularly. A DSCR between 0.75 and 0.99 typically qualifies at a reduced line with around six months of reserves. Below 0.75, we’ll usually look at our no-ratio program instead. Before anything, we check whether your DSCR was calculated on the interest-only or fully amortizing payment, because that alone can move you above 1.0.
What's the lowest DSCR you'll work with?
There’s no single floor. We place low-ratio files with reduced leverage and higher reserves, and for properties that stay too low, our no-ratio HELOC removes the DSCR requirement altogether in exchange for roughly 10 points less line. Send us the property and we’ll tell you where it lands.
What is a no-ratio HELOC?
A home equity line for investors where we don’t calculate DSCR at all. Instead of the property’s cash flow, qualification rests on your credit, equity, and reserves. It’s how we get investors financed on properties that don’t cover themselves on paper — renovations, vacancies, or brand-new short-term rentals.
How is DSCR calculated — with which payment?
Either the fully amortizing payment (principal, interest, taxes, insurance) or the interest-only payment (interest, taxes, insurance). Interest-only produces a higher DSCR because it drops the principal. Our programs differ, and we’ll run yours the most favorable defensible way for your file.
Does a market-rent appraisal help a low DSCR?
It can. If your lease is below market, a market-rent schedule (Form 1007) lets us use the appraiser’s supported market rent, which raises your DSCR without any change to the property. It’s one of the first levers we pull.
Don't stop here
DSCR for short term rentals and Airbnb
See how we help STR investors qualify for DSCR
Send us the property. We'll find the angle.
Give us your rental and its rent, and we’ll run it both ways, tell you the tier it lands in, and quote a low-ratio line and a no-ratio line side by side — so you can see exactly what Andes can put together before you commit to anything.
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