Approval based on the property—not your income
For real estate investors, traditional mortgages can feel limiting. Tax returns, personal income verification, and debt-to-income ratios often slow down—or completely block—otherwise solid deals.
That’s where DSCR loans come in.
A Debt-Service Coverage Ratio (DSCR) loan focuses on what matters most for an investment property: does the property’s income support the mortgage payment?
What Is a DSCR Loan?
A DSCR loan is an investment-property mortgage that qualifies the borrower based on the cash flow of the property, not the borrower’s personal income.
Instead of reviewing W-2s, tax returns, or pay stubs, the lender evaluates:
- Market rent or actual lease income
- Monthly principal, interest, taxes, insurance, and HOA
- The debt-service coverage ratio (DSCR)
If the property can pay for itself, the deal may qualify.
How Debt-Service Coverage Ratio Works
DSCR is calculated by dividing the property’s monthly income by its monthly housing expense.
- DSCR of 1.00 = Property income equals the mortgage payment
- Above 1.00 = Positive cash flow
- Below 1.00 = Property does not fully cover payment
Many programs allow DSCR loans at or near 1.00, depending on credit, reserves, and loan structure.
Who Benefits Most from DSCR Loans?
DSCR loans are ideal for:
- Real estate investors
- Self-employed borrowers with complex tax returns
- Buyers using depreciation write-offs
- Portfolio investors scaling quickly
- Short-term or long-term rental owners
These loans remove personal-income bottlenecks and speed up approvals.
Common DSCR Loan Features
- Investment properties only
- Single-family, condos, and small multi-units
- No personal income documentation
- Flexible entity ownership (LLCs often allowed)
- Down payments typically 20–25%
- Reserve requirements vary
Rates may be slightly higher than conventional—but flexibility is the tradeoff.
How Affinity Home Lending Helps Investors Use DSCR Strategically
We help investors:
- Analyze DSCR eligibility accurately
- Structure deals for approval
- Compare DSCR vs. conventional options
- Navigate short-term vs. long-term rental rules
- Scale portfolios efficiently
DSCR loans aren’t about shortcuts—they’re about smarter underwriting for investors.