DSCR Loans for Rental Property Investors
30-year fixed-rate and hybrid ARM financing on 1–4 unit residential and 5+ unit multifamily investment properties across 39 states. No income docs, no W-2s, no tax returns. Qualify on the property’s cash flow.
Qualify on Cash Flow, Not Tax Returns
What is DSCR?
DSCR stands for Debt Service Coverage Ratio. It measures whether a rental property generates enough income to cover its debt payment.
The Formula
DSCR = Gross Monthly Rental Income ÷ PITIA (principal, interest, taxes, insurance, association dues)
Example
Market rent: $2,400/month
PITIA: $2,000/month
DSCR: 1.20
The property earns 20% more than it costs to carry, and qualifies.
DSCR Long-Term Rental Loan Terms
| LOAN PARAMETER | DETAILS |
|---|---|
| Loan Purpose | Purchase, rate-and-term refinance, cash-out refinance |
| Loan-to-Value (LTV) | Up to 80% (purchase/rate-term refi); up to 75% (cash-out) |
| Loan Terms | 30-year fixed, 5/1 ARM, 7/1 ARM |
| Interest-Only Option | Available |
| Property Types | 1–4 unit residential, condos, townhomes, PUDs, and 5+ unit multifamily (non-owner occupied) |
| Rental Strategy | Long-term, medium-term, or short-term (Airbnb/VRBO) |
| Minimum DSCR | 1.00x (680+ FICO); 1.15x (660–679 FICO) |
| Minimum Credit Score | 660 |
| Loan Amount Range | $70,000 (SFR) or $150,000 (multifamily) up to $3,000,000, subject to underwriting ($115,000 minimum property value) |
| Rates | 30-year fixed from 6.55%* |
| Income Documentation | None required – qualify on property cash flow |
| Entity Borrowing | LLC, LP, Corporation (individual guarantor required) |
| Portfolios | Welcome |
| Prepayment Penalty | 5-year prepayment structure. Other options available through your loan officer. |
*Rates from 6.55% assume a credit score of 800 and a 60% LTV purchase of a single-family rental, with 5.5 points paid, priced as of October 15, 2026. Your rate depends on credit score, LTV, DSCR ratio and points, and is subject to underwriting and final approval. Get your exact rate in the Loan Sizer or call (972) 755-1880.
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Who Qualifies for a DSCR Loan at Ternus
DSCR qualification is built around the property, not the borrower’s paycheck.
What we evaluate
Property cash flow. Credit score (660 minimum, with better terms at higher scores). Down payment or equity (20–25% on purchases, 75–80% LTV on refinances). Borrowing entity (LLC, LP, or corporation with personal guarantor).
What we do NOT require
No W-2s. No tax returns. No pay stubs. No employment verification. No personal debt-to-income calculation. The property’s cash flow is the underwriting story.
Five Investor Scenarios Where DSCR Loans Outperform Conventional Financing
The self-employed investor
You take every legal deduction. Your tax returns show $47,000 in income, but your actual cash flow is three times that. A DSCR lender underwrites the property, not your tax returns.
The portfolio scaler
You already own 10 financed properties and hit the conventional loan cap. DSCR loans have no property count limit.
The BRRRR strategist
Buy, rehab, rent, refinance, repeat. Refinance out of your short-term hard money loan into a 30-year DSCR loan with cash-out at up to 75% LTV.
The short-term rental operator
Conventional lenders won’t count your Airbnb income. DSCR lenders qualify you with projected or actual short-term rental revenue.
The time-strapped investor
Found a deal that needs to close in three weeks? DSCR eliminates the income-doc bottleneck.
Ready to Grow Your Rental Portfolio?
All loan products are subject to underwriting, final approval, and verification. Rates and terms are for discussion purposes only and may vary. Not a commitment to lend.