Licensed Mortgage Loan Officer · NMLS #2103600 · Nationwide
DSCR Loans — Qualify on Property Cash Flow, Not Personal Income
DSCR (Debt Service Coverage Ratio) loans let real estate investors qualify based on what the property earns, not what shows up on a tax return. No personal income verification, no employment history, no W-2s. Vanessa Schlitt closes DSCR loans for investors nationwide.
What Is a DSCR Loan
Financing Built Around the Deal, Not Your W-2
A DSCR loan is qualified using the Debt Service Coverage Ratio — a simple comparison of the property's gross rental income against its monthly mortgage payment (principal, interest, taxes, insurance, and HOA if applicable). If the property's income covers its debt obligations, you can qualify, regardless of your personal income, tax returns, or job history.
This makes DSCR loans especially popular with self-employed investors, investors who already hold several financed properties and are running into conventional loan limits, and anyone whose tax returns don't reflect their true buying power because of deductions and write-offs.
Qualifying
What Lenders Look At
- Property's projected or in-place rental income (via appraisal rent schedule or lease)
- DSCR of 1.0 or higher is standard; below-1.0 programs are available in some cases
- Investment property only — primary residences don't qualify
- Reasonable credit history (specific requirements vary by scenario)
- Reserves to cover several months of mortgage payments
Common Questions
DSCR Loan FAQ
What is a DSCR loan?
DSCR stands for Debt Service Coverage Ratio. A DSCR loan qualifies you based on the rental income the property generates relative to its monthly debt obligations, rather than your personal income, tax returns, or employment history.
What DSCR ratio do I need to qualify?
Lenders typically look for a DSCR of 1.0 or higher, meaning the property's rental income covers its monthly mortgage payment. Programs exist for ratios below 1.0 as well, though they may carry different pricing or reserve requirements.
Can I close a DSCR loan in an LLC?
Yes. DSCR loans are commonly closed in an LLC or other business entity, which many real estate investors prefer for liability and portfolio management purposes.
Is a DSCR loan available for a primary residence?
No, DSCR loans are designed for investment properties only, including single-family rentals, small multifamily properties, and short-term rentals.
Do DSCR loans require tax returns or W-2s?
No. That's the core advantage of a DSCR loan — no personal income verification, no tax returns, and no employment history required. Qualification is based on the subject property's cash flow.