DSCR loan requirements

To qualify for a DSCR loan you commonly need a credit score of at least 620 to 700, a down payment of 20% to 25%, a property whose rent covers its full monthly payment (a DSCR of 1.00 or more at most lenders), and cash reserves of 2 to 12 months of that payment. You do not need tax returns, pay stubs or a debt-to-income ratio. The property has to be a rental you will not live in, and lenders set their own lines within these ranges.

DSCR loan requirements at a glance

Credit score

DSCR lenders pull all three bureaus and use the middle score, the lower of two if only two report. With several borrowers or guarantors, many lenders use the lowest middle score among them; a few use the highest.

Floors commonly sit between 620 and 700, with 660 to 680 the most usual line for a standard program. Price and maximum leverage step at tiers roughly every 20 points (660, 680, 700, 720, 740 and so on), so a score that crosses a tier is worth money. The top leverage, 80% and the 85% some programs offer, commonly needs 720 to 740 or more.

The score that counts is the mortgage score from a mortgage credit pull, which often differs from the one a credit app shows. Before you apply:

• Pay revolving balances down, and do not run up a card before closing.
• Avoid new credit in the weeks before the pull.
• Ask about a rapid rescore if paying off a balance would cross a tier.

Credit events carry waiting periods. Lenders commonly want three to four years since a foreclosure, short sale or bankruptcy, and some accept less at lower leverage. Late mortgage or rent payments are read as housing history, written as count, days late and months: 1x30x12 means one payment 30 days late in the past year. A clean record gets the best price.

Down payment and leverage

DSCR lenders commonly finance 75% to 80% of the price on a purchase, so you bring 20% to 25% down plus closing costs. Some programs go to 85% for top credit and smaller loans. Leverage commonly comes down for:

• Short-term rentals, often about 5 points less, so 25% to 30% down.
• Lower scores, often 65% to 75% for files in the 600s.
• Ratios below 1.00, and no-ratio loans.
• Condos, rural properties and 2 to 4 units at some programs.
• Cash-out refinances, commonly 70% to 75% of appraised value.

The down payment has to be your own money, sourced (traceable) and seasoned (in your account, usually for two months of statements). Many DSCR programs limit or refuse gift funds, and seller credits usually go toward closing costs, not the down payment. Borrowing against another property for the down payment is accepted at many lenders. With no debt-to-income test, that second payment does not count against the new loan, but you still have to make it. Investment property down payments covers where the money can come from, and loan-to-value ratio how leverage is measured.

For comparison, a conventional investment loan sold to Fannie Mae can go to 85% of the price on one unit and 75% on 2 to 4 units, but it qualifies you on your income, caps you at 10 financed properties and wants six months of reserves.

The minimum DSCR

The most common minimum is 1.00: the rent counted at least equals PITIA. Some programs want 1.10 to 1.25, especially for short-term rentals and cash-out refinances, and most lenders price best from about 1.25. How to calculate DSCR shows which rent and which payment go into the ratio.

Sub-1.00 and no-ratio loans

Some programs lend below 1.00, commonly down to about 0.75, and no-ratio programs skip the test entirely. They trade the rent test for everything else:

• More down: no-ratio loans often want 25% to 35%.
• Higher score floors, often 700 or more.
• More reserves, often a year of PITIA on no-ratio files.
• A higher rate than the same file at 1.00 or more.

They suit expensive markets where rents lag prices, a property you are repositioning, or a buyer with deep reserves who wants the property more than the cash flow.

Reserves

Reserves are the cash left after closing, counted in months of PITIA. Lenders commonly ask for 2 to 12 months, often 6, with more for large loans, ratios below 1.00, first-time investors and some short-term rental programs. Some add reserves for each other financed property you own.

What usually counts:

• Checking and savings, in full.
• Brokerage accounts, often at a discount for market risk.
• Retirement accounts, usually at a discount, and only the part you could withdraw.
• Cash-out proceeds from the same loan, at some lenders.

What often does not: gift funds, cryptocurrency that has not been moved to a bank, and money that cannot be traced. Expect to show your two most recent monthly statements, every page, with large deposits explained.

Loan size and property value

Minimum loans commonly run from $75,000 to $150,000, and some programs also set a minimum property value. Below those lines, fixed costs take a large share of the loan, which is why small DSCR loans price higher. Maximums commonly run from about $1.5 million to several million, and very large loans may need a second appraisal or a desk review.

Property types

The property has to be rent-ready. A house that needs significant work is usually financed first with a short-term rehab loan and refinanced into a DSCR loan once it is fixed and rented, the path the BRRRR method describes.

You, the borrower

Experience. Many DSCR programs accept first-time investors, often at lower leverage, a higher score or more reserves. Some ask that you own your own home or show a rental or mortgage payment history, and some want hosting experience before they count projected short-term rental income. Your schedule of real estate owned is how lenders read experience.

Ownership. You can borrow in your own name or through an LLC or corporation. An entity brings its articles, operating agreement, EIN letter and a recent certificate of good standing, and its owners, commonly anyone with 20% to 25% or more, sign a personal guarantee. Buying rental property in an LLC covers the paperwork and the trade-offs.

Residency. US citizens and permanent residents qualify everywhere. Non-permanent residents, borrowers with an ITIN and foreign nationals are accepted at some programs, usually with more down and more reserves.

Occupancy. A DSCR loan is business-purpose credit for a rental. Federal rules stop treating a property as non-owner-occupied once you expect to stay there more than 14 days in a year, and you sign a statement at closing that you will not live in it.

Documents you will be asked for

• A loan application and a signed credit authorization.
• A government photo ID, unexpired through closing.
• Your schedule of real estate owned: every property, its value, loan, payment and rent.
• Your two most recent bank statements, every page, covering the down payment, costs and reserves.
• The purchase contract, or the mortgage statement on a refinance.
• Any lease, with proof the rent is paid on a refinance.
• An insurance quote, then a binder naming the lender.
• LLC documents, if you borrow through one.
• For a short-term rental refinance, 12 months of booking platform statements.

The DSCR loan process shows when each one comes in.

Does this deal qualify?

Here is one deal run through the common lines. To run your own property through the same checks, start with GoDoor's quote calculator.

General education, not financial, tax or legal advice. Figures are examples: rates, rules and programs change, and every lender sets its own. Last checked November 4, 2026.