DSCR loans
A DSCR loan is built for real estate investors.
A DSCR (Debt Service Coverage Ratio) loan is an investment-property mortgage that qualifies based on the property's rental income rather than the borrower's personal income. No tax returns, no W-2s, no personal debt-to-income calculation — just the rent-to-payment math on the property itself.
What is a DSCR loan?
A DSCR loan measures the ratio of a property's expected monthly rent to the total monthly payment on the mortgage (PITIA — principal, interest, taxes, insurance, and any HOA). A ratio of 1.00 means the property's rent exactly covers the payment. Ratios of 1.25 and above are more common for approval.
DSCR loans are non-QM (non-qualified mortgage) products designed exclusively for investment properties. They are not for primary residences.
How the DSCR is calculated
The formula is straightforward: Gross Monthly Rent ÷ PITIA = DSCR. For example, a property expected to rent for $2,500 per month with a total PITIA payment of $2,000 has a DSCR of 1.25. Many DSCR programs require a minimum DSCR of 1.00 or 1.25, with better pricing for higher ratios.
Some DSCR programs allow "no ratio" (0.75 DSCR) options for investors with strong credit and larger down payments.
Common uses
DSCR loans are widely used for long-term rentals, short-term rentals (with lender-specific documentation), and BRRRR (Buy, Rehab, Rent, Refinance, Repeat) strategy refinances. They are especially useful for self-employed investors whose tax returns understate their actual income.
Key benefits
- Qualify using property rental income — no tax returns or personal DTI
- Available for purchase, refinance, and cash-out refinance
- Long-term rentals, short-term rentals, and multi-unit properties eligible
- LLC ownership generally allowed
- Fixed and adjustable rate options
Who this loan fits best
- Real estate investors expanding their portfolio
- Self-employed investors whose tax returns understate income
- Investors buying LLC-titled properties
- BRRRR-strategy refinances after rehab
Estimate your monthly payment
DSCR (Investor) payment calculator
Estimate only. Actual rate, taxes, insurance, and mortgage insurance depend on your specific loan and property. Belong Lending confirms your exact payment at pre-approval.
Serving Detroit and surrounding Michigan communities
Belong Lending helps borrowers with DSCR (Investor) loans across Detroit, Troy, Southfield, Ann Arbor, Flint, Livonia, Warren, Sterling Heights, Farmington Hills, Novi, Rochester Hills, Dearborn, and beyond — plus additional coverage throughout Wayne County, Oakland County, Macomb County, Washtenaw County, Livingston County, Genesee County. We also lend on eligible properties in Ohio, Florida, Georgia, and Texas.
Frequently asked questions
How is a DSCR loan different from a conventional investment property loan?
A conventional investment property loan qualifies you on personal income (tax returns, W-2s, personal DTI). A DSCR loan qualifies you on the property's rental cash flow — no personal income documentation required. That makes DSCR loans especially useful for self-employed investors and buyers with multiple properties.
What DSCR do I need?
Most DSCR programs require a ratio of 1.00 – 1.25 for best pricing, meaning the rent covers the payment or exceeds it by 25%. Some programs allow lower ratios (down to 0.75, "no ratio") with higher credit scores and larger down payments.
Can I close a DSCR loan in an LLC?
Yes. Most DSCR lenders allow the property to be titled in an LLC, which is a common structure for investors managing multiple properties.
Can I use DSCR loans for short-term rentals (like Airbnb)?
Many DSCR lenders now allow short-term rental income to qualify, using AirDNA reports, 12-month rental history, or comparable property projections. Documentation requirements vary by lender — Belong Lending matches you to the right one for your strategy.