Non-QM | DSCR Loans

DSCR Loans For Real Estate Investors

DSCR loans allow real estate investors to qualify using rental income from the property instead of personal income or tax returns. Finance long-term rentals, short-term rentals, and investment properties with flexible qualification options.

loan snapshot

Rates updated daily

30-yr. fixed

6.394%

6.406% APR

15-yr. fixed

5.874%

5.9% APR

7-yr. ARM

6.216%

6.363% APR

30-yr. fixed VA

5.81%

6.143% APR

What is a DSCR loan?

A DSCR loan is an investment property loan that lets you qualify based on the rental income of the property, not your personal income, W-2s, tax returns, or debt-to-income ratio.

This is huge for investors because traditional mortgage loans often punish people who write off expenses, own multiple properties, or have complex income. Growing a real estate portfolio with conventional loans gets extremely difficult once you have more than a couple of properties. With a DSCR loan, the question becomes much simpler:

Does the property make enough rental income to support the payment?

How DSCR Is Calculated

DSCR = Rental Income ÷ Monthly Property Payment

Example

monthly rent

Mortgage PITIA

DSCR

$3,000

$2,500

1.20

Watch your DSCR

Most DSCR lenders want to see a debt coverage ratio of **1.00 or higher**, which means the property’s rental income is enough to cover the monthly mortgage payment. You may still be able to qualify with a DSCR below 1.00, but lower ratios can come with higher interest rates, larger down payment requirements, or fewer lender options.

DSCR LOAN HIGHLIGHTS

dSCR loans are the premier solution for real estate investors who want to grow

Created for real estate investors who are looking to increase their rental portfolio

DSCR loans are designed for new and experienced real estate investors who want to build a portfolio of long term or short term rental properties. 

No personal income required

No tax returns, W2s or pay stubs are ever required on our DSCR loans.

Qualify on rental income

We qualify you based on the income generated by the property

Flexible Property Types

Finance single family, multifamily up to 30 units and other commercial properties

Airbnb and short term rental options

Many programs allow projected short-term rental income for qualification purposes.

DSCR loan calculator

Before you fall in love with the deal, make sure the numbers actually work. Use our DSCR loan calculator to estimate the property’s cash flow and see if the rental income may support the loan.

loan comparisons

DSCR Loan Vs Conventional mortgage

Requirement	DSCR Loan	Conventional Loan
Income	Based on rents	Personal income documentation required
Credit score	620 minimum	640 minimum
Minimum down payment	15% down	15% down
Can close in LLC	Yes	Not allowed
Mortgage reports to credit	Sometimes, depends on lender	always
Maximum seller contributions	Up to 6% allowed	Up to 2% allowed
Prepayment Penalty	Yes, 1-5 years but can be bought out	Not allowed under fannie Mae guidelines
First-time investor allowed	Yes but depends on lender	Yes, allowed
Allows short term rental income	Airbnb, VRBO, short term rental allowed	No, long term rental only

In a nutshell 🥜

The simple difference between a DSCR Loan and a Conventional Mortgage

DSCR Loan

You qualify based on the rents of the property that you are purchasing on your current rents if you are looking to refinance.

As your lender, we require an appraisal with a market rent schedule called a 1007. The appraiser provides his opinion and analysis about the market rent of the property. The DSCR loan takes that number and divides it by the total mortgage payment of the property.

Your personal income is never required, and we do not calculate a debt-to-income to qualify you.

Getting a DSCR loan is a very streamline and fast process especially for those with low or complex personal income or who want to grow a rental portfolio.

Conventional mortgage

You are probably already familiar with this loan when you bought your primary home. To qualify you, the conventional mortgage requires personal income documentation such as W2s, pay stubs or tax returns if you receive self-employment or rental income. Your personal debt-to-income ratio is calculated to make a decision about your borrowing capacity.

To help you qualify, we ask an appraiser to estimate the market rent of the property you are purchasing and generally, we take 75% of the subject property’s market rent.

Getting a conventional mortgage for an investment property can help you get lower rates but the process can be daunting and it becomes extremely difficult to grow as an investor with this loan.

having troubles deciding the best option for you?

minimum Requirements for a DSCR loan

credit score

620+

minimum down payment

15% to 20%

Debt-to-income ratio

None

Mortgage insurance

Not Required

Occcupancy

Investment only

Loan limits

Up to $3 Million

DSCR Loans may be a good fit for you if...

You are looking to increase your rental portfolio

Your personal income is too low to qualify for investor mortgages

You are looking for multifamily financing that expands beyond 4 units

You have a complex situation that will not let you qualify for a conventional loan.

Can You Use a DSCR Loan for Airbnb or Short-Term Rentals?

Yes, Andes Mortgage's DSCR loans allow for short-term income
Income is calculated based on AirDNA data and appraisal
This can be huge for investors buying in vacation markets, high-demand cities, or tourist areas.
Not every lender treats Airbnb income the same, which is why working with a broker like Andes Mortgage matters.

When a DSCR loan may NOT be the right fit

DSCR LOAN FAQ

Frequently Asked Questions

Get answers to some of the most common questions about DSCR loans for real estate investors

What does DSCR Mean?

DSCR stands for Debt Service Coverage Ratio, which measures a property’s rental income compared to its mortgage payment.

Do DSCR loans require tax returns to qualify?

Never! DSCR loans qualify borrowers using rental income from the property whether it’s long term or short term rental.

Can I close a DSCR Loan under an LLC?

Yes. We allow you to title the property under an LLC or business entity.

Can I do a DSCR loan on a commercial property?

Yes. Our DSCR loans will help you finance commercial properties such as office, retail, restaurants and more.

Do you offer a 15% down payment DSCR Loan?

Yes! At Andes Mortgage, we offer DSCR loans with a minimum 15% down payment. This is great because it helps you keep more cash in your pocket.

ready to explore your DSCR loan options?

Let’s walk through your numbers and see if a DSCR loan is the right option for you.

770-740-4050

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