DSCR Rental Loans (Cash-Flow-Based Financing)
Tallridge DSCR loans provide $150K to $5M in long-term financing for rental properties based on cash flow, not personal income. With up to 30-year terms, fixed or ARM options, and no income verification required, these loans are ideal for real estate investors building rental portfolios with stabilized properties.
Finance your rental portfolio based on the property's performance—not your paystub.
Key Facts
| Parameter | Typical Range / Details |
|---|---|
| Loan Amount | $150k–$5M (single asset) – portfolio financing by request |
| Term | Up to 30 years; fixed or ARM options |
| Sizing Basis | DSCR (NOI ÷ Debt Service) |
| DSCR Threshold | Typically ≥ 1.0–1.25 (market dependent) |
| Use of Proceeds | Purchase, rate/term refinance, cash-out refinance |
| Property Types | 1–4 unit rentals, small multifamily, mixed-use (case-by-case) |
What is a DSCR loan and how does it work?
A DSCR loan is a long-term mortgage where the loan amount is determined by the property's ability to generate enough net operating income (NOI) to cover its debt payments.
Instead of verifying personal income, lenders evaluate DSCR: NOI ÷ Annual Debt Service.
Why use DSCR-based financing?
For rental investors, DSCR loans allow scaling without traditional income verification. The property's performance is the key qualifier, making it ideal for full-time investors, self-employed owners, and portfolio landlords.
Who qualifies?
- Stabilized properties with proven rent roll.
- DSCR above lender minimums (usually 1.0–1.25). Most national DSCR lenders set their minimum at 1.20 for standard programs.
- Adequate reserves for payments, taxes, and insurance.
- Borrowers with acceptable credit and asset documentation.
How is DSCR calculated?
The higher your DSCR, the more cash flow cushion your property has
In this example, the property generates 25% more income than needed to cover debt payments
What properties fit?
Single-Family Rentals
Individual houses generating rental income
2-4 Unit Properties
Duplex, triplex, and fourplex rentals
Small Multifamily
5-20 unit apartment buildings
Mixed-Use
Commercial + residential income properties
Program options available
Purchase
Buy income-producing rentals with financing based on the property's cash flow, not your W-2.
Rate/Term Refinance
Replace an existing loan with better terms to improve cash flow and returns.
Cash-Out Refinance
Tap equity for improvements or additional acquisitions while maintaining long-term financing.
Example Scenario
An investor owns a fully leased 12-unit building with NOI of $150,000/year.
Result: At a DSCR requirement of 1.20 and 70% LTV, the property can support up to $125,000/year in debt service—translating to a ~$1.8M loan on a 30-year amortization at current market rates.
Advantages
No Personal Income Verification
Qualification based on property income, not personal income.
Long-Term Financing
Long-term amortization for predictable payments.
Portfolio Scaling
Works for investors with multiple properties.
Considerations
DSCR below threshold may require higher down payment.
Property must be stabilized—vacant or under renovation generally won't qualify.
Rates may be higher than owner-occupied financing.
Frequently Asked Questions
Do you allow cash-out refinances?
Are short-term rentals eligible?
What's the minimum DSCR required?
Let Your Property's Performance Do the Talking
Qualify based on cash flow, not tax returns. Get long-term financing for your rental portfolio.
Additional Resources
Fannie Mae - Understanding DSCR
Official guidance on DSCR calculations and requirements.
Investopedia - Debt Service Coverage Ratio
Comprehensive guide to understanding DSCR metrics.
HUD - Rental Housing Finance
Federal resources for rental property financing.
Freddie Mac - Multifamily Market Trends
Latest data on rental market and lending trends.
Rates/terms subject to change and underwriting. Not an offer to lend. Equal opportunity lender.