A DSCR loan qualifies an investment property on the rent it produces instead of your personal income. For investors with several properties or big write-offs, that can be the difference between a yes and a no.
The formula
DSCR = monthly rent ÷ monthly PITIA (principal, interest, taxes, insurance, and association dues). If rent is $2,400 and PITIA is $2,000, DSCR is 1.20.
What lenders look for
Many lenders price best at 1.20 to 1.25 and above, and 1.00 is a common minimum. Some programs allow lower ratios with a larger down payment.
Ohio vs. Florida
In Northeast Ohio, lower purchase prices often produce strong ratios on long-term rentals. In Southwest Florida, insurance and HOA dues can pull the ratio down, so get real quotes early. Short-term rentals may qualify on booking history with some lenders.
Ready to see your options?
Apply online in about 15 minutes, or call to talk it through first.