Last updated: January 2026
Quick answer
The best DSCR loan providers offer flexible qualification based on rental income, not personal income. These lenders cater to real estate investors by focusing on the property’s debt service coverage ratio (DSCR), making it easier to finance income-generating properties without relying on W2s or tax returns.
What makes a lender the best DSCR loan provider?
A strong DSCR loan provider offers more than just competitive rates.
DSCR loan providers structure their programs specifically for real estate investors using property cash flow as the foundation for approval.
Top DSCR lenders share these features:
- Qualify borrowers using rental income, not personal income
- Allow lower DSCR thresholds (some as low as 0.75 or even no ratio)
- Accept short-term and long-term rental properties
- Provide fast pre-approvals and limited documentation
- Support a range of property types and borrower experience levels
- Offer high LTVs, up to 85% for purchase transactions on single-family rentals, and up to 80% for DSCR refinance and cash-out transactions, depending on loan structure
How DSCR loans work for real estate investors
The best DSCR loan providers offer options for:
- New investors with no rental history
- Experienced investors scaling their portfolios
- Foreign nationals investing in U.S. real estate
- No max property restrictions
- Entrepreneurs with non-traditional income
Defy Mortgage DSCR LTV guidelines by transaction type
These LTV limits apply to Defy Mortgage DSCR loan programs. Other lenders may differ.
- Purchase transactions (single-family rentals): Up to 85% LTV
- Rate-and-term refinances: Up to 80% LTV
- Cash-out refinances: Up to 80% LTV
Maximum LTV limits may vary based on property type, DSCR ratio, credit profile, and rental strategy.
DSCR loans are designed for financing rental properties. Instead of reviewing your personal income or employment history, lenders use the debt service coverage ratio (DSCR) to evaluate whether the property generates enough income to cover its loan payments.
What is DSCR?
DSCR = Monthly Rental Income / Monthly Loan Payment
- A DSCR of 1.0 means income covers the loan exactly
- A DSCR of 1.25 is often preferred, providing a 25% income cushion
- Some lenders offer DSCR loans down to 0.75 or even no ratio
Since DSCR loans focus on the property’s performance, they’re ideal for:
- Real estate investors building cash flow portfolios
- Short-term rental property owners (e.g., Airbnb, VRBO)
- Self-employed borrowers with variable personal income
What to compare when evaluating DSCR loan providers
Not all DSCR lenders offer the same flexibility. When choosing the best DSCR loan provider, look beyond just rates. Focus on terms, eligibility, and each lender’s support for investors.
Evaluation checklist:
- Minimum DSCR allowed: Some start at 1.25; others accept 0.75 or lower
- Maximum LTV: Varies by lender and transaction type. At Defy Mortgage, up to 85% LTV for purchase transactions (SFR only) and up to 80% LTV for rate-and-term and cash-out refinances
- Minimum credit score: Ranges from 620 to 700, depending onthe provider
- Eligible properties: Single-family, multifamily (up to 4 units), short-term rentals
- Ownership structure: Does the lender allow LLCs or trusts to hold title?
- Documentation: No W2s, tax returns, or DTI are usually required
- Turnaround speed: Some providers close in as little as 7–10 days
- Loan size: Maximums range from $1M to $5M+
Example DSCR loan programs compared
The DSCR loan providers listed below were selected based on publicly available program guidelines, investor demand, and common qualification criteria, including DSCR minimums, LTV limits, credit requirements, and support for rental strategies. Loan terms and availability may vary by borrower profile, property type, and market conditions.
Here’s a quick side-by-side comparison of key features offered by top DSCR loan providers:
| Provider | Min DSCR | Max LTV | Min FICO | Short-Term Rentals Allowed | LLC Ownership |
|---|---|---|---|---|---|
| A&D Mortgage | 0.0 | 80% | 620 | Yes | Yes |
| Angel Oak | 1.0 | 85% | 680 | Yes | Yes |
| Defy Mortgage | 0.75 or no ratio | 85%* | 640 | Yes | Yes |
| Griffin Funding | 0.75 | 80% | 620 | Yes | Yes |
| JMac Lending | 0.75 | 75% | 660–700 | Yes | Yes |
| Kiavi | 1.0 | 80% | 660 | Yes | Yes |
| Lima One Capital | 1.20 | 80% | 670 | Yes | Yes |
* At Defy Mortgage, 85% LTV applies to purchase transactions on single-family rentals. DSCR rate-and-term and cash-out refinances are capped at 80% LTV.
Advantages of using DSCR loan providers
DSCR loans offer unique benefits that make them ideal for real estate investors, especially those with non-traditional income.
Why investors choose DSCR loans:
- No personal income verification: Skip the W2s, tax returns, and pay stubs
- Speed: Faster approvals by focusing on property performance, not your financial history
- Scalability: No limit to the number of DSCR loans you can hold
- Flexibility: Easier approval for first-time or self-employed investors
- Cash-out options: Leverage equity from one property to finance another
- LLC-friendly: Many DSCR lenders allow properties to be held under business entities
If your goal is to grow your real estate portfolio efficiently, DSCR loan providers offer a flexible path to long-term investing success.
What lenders look for in DSCR applicants
Although DSCR is the main qualifying factor, providers still consider other criteria.
What DSCR loan providers typically review:
- Property income: Can it reliably cover the loan payment?
- DSCR ratio: A higher ratio often unlocks better rates
- Credit score: Most require 620 or higher
- LTV ratio: Lower LTVs reduce risk and may lower rates
- Property type: Typically must be non-owner-occupied rental housing
- Borrower experience: Some lenders offer better terms for experienced investors
Even if your personal finances are complex, a strong property with stable income can make you an ideal DSCR borrower.
For investors prioritizing higher leverage, flexible DSCR thresholds, and streamlined documentation, especially on single-family rental purchases, some DSCR loan providers offer more aggressive terms than others.
Why real estate investors choose DSCR loans from Defy Mortgage
At Defy Mortgage, we know that not every borrower fits the traditional mold—especially real estate investors. That’s why our DSCR loan programs are designed to assess property performance, not personal income.
Here’s what sets us apart:
- Flexible qualification based on rental income, not tax returns
- DSCR loans available in over 35 states
- Support for short-term and long-term rental properties
- Loan options for both new and seasoned investors
- Streamlined approval process and no W2s or tax returns required
- Programs available for refinance, including DSCR cash-out refinance, equity access, and property acquisition
Defy the traditional
Whether you’re scaling your portfolio or investing in your first property, we tailor DSCR mortgage solutions to fit your income strategy and investment goals.
Explore DSCR loan options built for your rental income. Schedule a consultation or request a personalized quote from a Defy Mortgage specialist today.
Frequently asked questions: DSCR loan providers
Q: What is a DSCR loan?
A DSCR loan is a real estate investment mortgage in which the borrower qualifies based on the property’s rental income rather than personal income or employment documentation.
Q: What is a good DSCR ratio for loan approval?
Most lenders prefer a DSCR of 1.25 or higher, but some will approve borrowers with DSCRs as low as 0.75, or even no ratio, depending on the provider.
Q: Can I get a DSCR loan with bad credit?
Yes. Many DSCR loan providers accept credit scores as low as 620, though better scores may lead to better terms.
Q: Are DSCR loans available for short-term rentals?
Yes. Many lenders offer DSCR financing for Airbnb, VRBO, and other short-term rentals, provided income projections are supported by market data.
Q: What kind of properties qualify for a DSCR loan?
Eligible properties typically include single-family homes, multifamily properties up to 4 units, and vacation or rental homes. Commercial properties may also qualify, depending on the lender.
Q: Is a DSCR loan a non-QM loan?
Yes. DSCR loans are considered non-QM products because they don’t follow standard income verification rules like conventional loans.
Q: Can I use a DSCR loan for multiple properties?
Yes. There’s no cap on how many DSCR loans you can hold, as long as each property meets the lender’s income requirements.
