DSCR Loan Requirements & Rates today

DSCR Loan Requirements

DSCR loans are fairly straightforward. As long as the rent covers the mortgage payments, half the battle is won. Ideally, DSCR lenders like to see a debt service coverage ratio (DSCR) above 1.2, meaning the market rent charged is 20% higher than the mortgage payment.

But not every lender draws the line there. Some are more flexible. For example, some lenders have no minimum DSCR on their programs — making them a solid option for properties that break even or come close. Other lenders are more fluid, requiring a 1.20 DSCR for borrowers with a credit score under 720, but drops that to 1.10 for borrowers at 720 or above. The main takeaway? Your credit score and the lender you choose can meaningfully affect how much rental income you need to qualify.

[placeholder for DSCR calculator] Check your DSCR — calculator: rent payment, mortgage size, interest rate

Credit Score, LTV, and Loan Amounts

Beyond the DSCR itself, lenders look at a few other key factors.

Most DSCR programs start at a minimum credit score of 640. Most lenders sit around that threshold for their base programs. Move up to 660 and more doors open and a handful of premium programs, require 700 or higher.

Loan-to-value (LTV) limits are fairly consistent across the board. For purchases and rate-term refinances, most lenders cap at 80% LTV — meaning you'll need at least 20% equity or down payment. For cash-out refinances, the typical max drops to 75%. Some lenders we work with go as high as 85% on purchases for borrowers with 740+ credit scores, while others like are more conservative at 75-80% but have a lower credit threshold.

Loan amounts vary widely by lender. Smaller investors can access programs starting as low as $70,000–$100,000. Larger portfolios can tap into programs up to $50 million or more.

Loan Terms and Structure

One of the most appealing things about DSCR loans is the range of term options available. Most lenders give people loans that last for thirty years with a fixed interest rate. This helps investors know how much they will be paying every month for a time. They do not have to worry about refinancing their loan every years. There are also loans with interest rates. These are called adjustable-rate mortgages or ARMs for short. Lenders offer kinds of ARMs like 5/1, 7/1 and 10/1. The numbers in these ARMs mean that the interest rate is fixed for five, seven or ten years. After that the interest rate can change. Adjustable-rate mortgages or ARMs are available, from lenders.

Interest-only (I/O) options are another lever worth knowing about. Several programs allow I/O periods — useful for investors who want to maximize short-term cash flow while a property stabilizes or appreciates.

Prepayment penalties vary by lender and program. We offer everything from no prepayment penalty to a flat 5-year prepay. Some use a 5-year declining structure (5%, 4%, 3%, 2%, 1%). If you plan to sell or refinance within a few years, this is a number worth paying attention to.

Seasoning and Reserves

For cash-out refinances, most lenders want to see at least 6 months of ownership before they'll use the appraised value. If you've owned the property for less than 6 months, lenders will typically use the purchase price (or cost basis) instead — which can reduce how much cash you're able to pull out.

Reserves are another standard requirement. Most lenders ask for 3 to 12 months of PITIA (principal, interest, taxes, insurance, and association dues) held in reserve. If reserves feel tight, we have options that will waive or reduce the requirement for borrowers with stronger credit profiles.

DSCR Loan Rates Today

If you want to take a look at your DSCR loan rates today, fill out the form at the bottom with basic information, and we'll get back to you shortly with an estimated quote — no commitment required.

Rates in the current market vary based on your credit score, LTV, loan term, and property type. Our most competitive programs have rates starting at 5.99% for DSCR loans. More commonly, rates between 9.9% and 11.9% are to be expected for residential DSCR products. The spread is wide, which is exactly why working with a financing partner who shops multiple lenders — like Fluid Capital — can make a real difference to your bottom line.