What is a DSCR Loan?

A DSCR Loan is a mortgage option that allows borrowers to qualify based on the income generated by the investment property instead of using traditional income verification methods, such as tax returns or pay stubs. This loan type is ideal for real estate investors who may not have a traditional W-2 income but have properties that generate strong rental cash flow.

Lenders calculate the Debt Service Coverage Ratio (DSCR) by dividing the property’s net operating income (NOI) by its total debt obligations. A DSCR of 1.0 or higher typically indicates that the property’s rental income is sufficient to cover mortgage payments, making approval easier for investors.

Benefits of a DSCR Loan

• No Personal Income Verification – Unlike conventional loans, DSCR loans focus on the property’s income rather than the borrower’s tax returns or employment history.
• Easier Qualification – Investors with multiple properties or non-traditional income sources can qualify based on rental income.
• Unlimited Properties – Many DSCR loan programs allow borrowers to finance multiple properties without strict limitations.
• Flexible Loan Terms – Enjoy competitive interest rates, flexible down payment options, and adjustable loan terms that fit your investment strategy.
• Fast and Efficient Process – Since personal income documentation isn’t required, the approval process is often quicker than traditional mortgage loans.

Who Can Benefit from a DSCR Loan?

A DSCR loan is a great option for:

• Real estate investors looking to expand their portfolios
• Self-employed individuals without traditional income documentation
• First-time investors who want to finance their first rental property
• Seasoned investors who need financing for multiple properties
• Buyers interested in short-term or long-term rental properties

How to Qualify for a DSCR Loan

Qualifying for a DSCR loan is straightforward. Lenders evaluate:

• Property’s Rental Income – The property should generate enough rental income to cover the mortgage payment.
• Credit Score – While requirements vary, a strong credit score improves loan terms.
• Down Payment – Most DSCR loans require a down payment of at least 20-25%, though terms may vary.
• DSCR Ratio – A DSCR of 1.0 or higher is preferred, though some lenders offer flexibility.

Get a DSCR Loan with Edge Home Finance

At Edge Home Finance, we understand the unique financing needs of real estate investors in Tulsa. Our team of experts is ready to help you secure a DSCR loan with competitive rates and flexible terms. Whether you’re purchasing, refinancing, or expanding your rental property portfolio, we make the process simple and hassle-free.

Ready to invest in your future? Contact Edge Home Finance today to explore your DSCR loan options and take the next step toward building your real estate portfolio!