When you’re building a rental portfolio, traditional lending can feel like a dead end. Banks want W-2s, tax returns, and a squeaky-clean DTI—none of which reflect the real strength of your deals. That’s where DSCR loans come in.
DSCR stands for Debt Service Coverage Ratio, and it flips the traditional approval process on its head. Instead of judging you by your personal income, DSCR loans look at one thing: Does the property pay for itself?
DSCR Formula:
Monthly Rental Income ÷ Monthly Debt Payment
(A DSCR above 1.0 means the property cashflows.)
Why DSCR Loans Are Perfect for Investors
1. No W-2s or Tax Returns Needed
Self-employed? Living off rental income? Don’t feel like explaining 17 LLCs to a bank underwriter? DSCR loans skip the personal docs and focus on the deal.
2. Fast, Streamlined Approvals
Less paperwork = quicker closings. Most DSCR loans fund in weeks, not months.
3. Perfect for Scaling
No DTI caps. No portfolio limits. Keep growing as long as your properties cashflow.
4. Ideal for Long-Term & Airbnb Rentals
DSCR works for traditional rentals, vacation properties, and even mid-term stays.
5. You Can Close in an LLC
Most DSCR lenders (like Happy Funds) allow entity-based closings for better protection and structure.
Real-World Example
You’re buying a rental for $300,000. It rents for $2,200/month. Your total monthly payment is $1,600.
That gives you a DSCR of 1.375 — and you’re in.
No tax returns.
No W-2s.
Just a deal that works.
Important Notes
- Down payment is typically 20–25%
- Rates are slightly higher than conventional, but well worth the flexibility
- Some loans may include a prepayment penalty, depending on the term
Who Should Use DSCR Loans?
- Investors building rental portfolios
- Flippers refinancing into cashflow
- Airbnb/short-term rental hosts
- Self-employed buyers
- Anyone tired of banks saying “no”
Let’s Get You Funded
If your deal cashflows, chances are we can fund it.
We’ll walk you through it, run the numbers, and handle the heavy lifting so you can focus on your next move.
Submit Your Deal or Ask a Question →
We keep it simple. Fast closings. No red tape. Just smart lending for smart investors.