- Income documents
- None. No tax returns or pay stubs
- Ownership
- Close in an LLC or your own name
- Down payment
- Typically 20% to 25%
- Property types
- 1 to 4 units, many short-term rentals
What it is
A debt service coverage ratio loan qualifies the property rather than the person. If the rent covers the mortgage payment, the loan can work with no personal income documented and with the title held in your LLC.
How it works with a broker
DSCR is the monthly rent divided by the monthly payment, including taxes, insurance and any HOA dues. A ratio of 1.0 means the rent exactly covers the payment. Most lenders want 1.0 or higher, and some go lower with a bigger down payment.
Lenders differ on how they count short-term rental income, how many properties you can finance and whether first-time investors are allowed. I know which lenders fit which deals.
Common questions
Can I really close in an LLC?
Yes. Most DSCR lenders allow the loan to close in the name of an LLC, with you signing as a personal guarantor.
Does my job or income matter at all?
Not for qualifying. Lenders look at your credit score, down payment, cash reserves and the property's rent.
Figures shown are typical guidelines and can vary by lender, credit profile and property. They are not an offer or commitment to lend.
Find out what you qualify for.
Answer a few questions and I will come back with real options, usually the same day. It takes about two minutes and does not affect your credit.