DSCR Loans: Mortgage Solutions for Real Estate Investors

Debt-Service Coverage Ratio (DSCR) Loans offer a unique opportunity for real estate investors to qualify for financing based on rental income, not personal income. At the JD.Mortgage team, we help investors build wealth with simple qualification, fast closings, and investor-focused underwriting guidelines. If you’re looking to grow your portfolio without tax return hassles or job verification, a DSCR loan might be the right tool for you. Let’s explore how this program works.

What Is a DSCR Loan?

A DSCR loan uses the income from the subject property—usually a rental—to determine eligibility. Lenders look at the property’s cash flow, not your W-2s or tax returns. The key metric is the debt-service coverage ratio, which compares monthly rental income to monthly mortgage payments. If the rent covers the mortgage (typically DSCR ≥ 1.0), you have a strong shot at approval. Explore more non-QM options here.

How DSCR Loans Work

DSCR loans are underwritten using the rental income the property generates—or could generate—based on market rents or lease agreements. There’s no need for traditional income verification, making this an ideal solution for self-employed investors, entrepreneurs, and buyers with complex finances. Learn how to get started.

Common DSCR Loan Requirements

• Minimum DSCR: Typically 1.00 or greater (some exceptions may allow below 1.0)
• Credit score: Often 620+, but we offer flexible options
• Property types: Single-family, 2–4 units, condos, townhomes
• Loan amounts: Up to $3M+ in many cases
• Down payment: Usually 20–25%

DSCR loans are asset-based, which means your ability to repay is tied to how the property performs—not your job or tax returns. Explore additional investment financing solutions.

Benefits of DSCR Loans

Here’s why investors love using DSCR loans:

• No income verification (no W-2s, pay stubs, or tax returns)
• Great for LLCs and holding companies
• Allows portfolio expansion with ease
• Flexible terms and fast closing timelines

If you’ve been turned down due to complex finances, DSCR loans could be your path forward. Reach out today to discuss your scenario.

Who Should Consider a DSCR Loan?

DSCR loans are built for:

• Real estate investors with rental income
• Self-employed borrowers or business owners
• Foreign nationals looking to invest in U.S. property
• Retirees or those with non-traditional income sources

Whether it’s your first rental or your tenth, we can help. View all loan options available to you.

DSCR Loan vs. Conventional Financing

Traditional mortgage programs require personal income documentation, high credit scores, and full tax returns. DSCR loans skip those steps and focus solely on the investment property’s revenue. For many investors, this opens doors that conventional loans simply can’t.

Want help comparing options? Check out conventional loan options here.

How to Calculate DSCR

The basic formula is:

DSCR = Gross Rental Income / Total Monthly Mortgage Payment

Example: If the rent is $2,000 and the total mortgage payment (including taxes, insurance, and HOA) is $1,800, the DSCR is 1.11—well within approval range.

Need help running the numbers? Try our mortgage calculator.

Can You Qualify for a DSCR Loan With a Low DSCR?

Possibly. Some lenders will allow DSCRs below 1.0 with compensating factors like large reserves, low LTV, or higher credit. The JD.Mortgage team works with a broad network of DSCR loan providers—if there’s a way to get it done, we’ll help you find it. Let’s connect about your property.

Foreign National and Non-QM DSCR Options

DSCR loans also work for foreign investors or borrowers who fall outside traditional lending boxes. As part of our non-QM suite, these loans can be structured for various borrower types, including those with ITINs or without U.S. income documentation. Explore all non-QM programs here.

Fast Closings for Cash-Flowing Properties

Time is money in real estate, and delays can cost deals. DSCR loans are often faster to underwrite since there’s less paperwork. Many close in 2–3 weeks. Want to close faster? Get your property evaluated today.

Your Partner in Real Estate Investment

Whether you’re buying a rental, refinancing a portfolio, or seeking creative financing, we’ll help you structure the deal with your investment goals in mind. The JD.Mortgage team knows investor lending inside and out. We work nationwide (except NY) with flexible options, custom terms, and no unnecessary overlays.

We also offer a wide array of other solutions to support your next move, including VA, FHA, USDA, DPA, Investment Property, Non-QM (DSCR, Bank Statement, ITIN), HELOCs, Second Mortgages, Reverse Mortgages, and Construction Loans. Explore our full range of loan options.