DSCR Loans for Real Estate Investors in California
Debt Service Coverage Ratio loans for real estate investors. Qualify based on property cash flow, not personal income. Ideal for rental portfolios.
Overview
A DSCR (debt service coverage ratio) loan qualifies you on what the property earns, not on what your personal tax returns show. For investors building rental portfolios in the East Bay, Sacramento, Arizona, Texas or Florida, it removes the two things that stall conventional investor financing: income documentation and the cap on financed properties.
DSCR loans allow real estate investors to qualify based on the rental income of the property rather than personal income. This is the go-to program for building a rental portfolio without the limitations of traditional income documentation.
Program Features
- Qualify on property cash flow, not personal income
- No tax returns or employment verification required
- Available for short-term and long-term rentals
- LTV up to 80%
- Unlimited properties
- LLC and entity vesting available
Ideal For
Real estate investors, landlords building rental portfolios, and Airbnb/VRBO hosts.
How DSCR qualification works
The lender divides the property's gross rent (actual lease or market rent from the appraisal) by the proposed monthly payment including taxes, insurance and any HOA. A ratio of 1.0 means the rent covers the payment; most programs prefer 1.0 or higher, and some allow ratios below 1.0 with a larger down payment. No tax returns, no W-2s, no employment verification, no debt-to-income calculation. Credit score, down payment and reserves drive the pricing.
Program highlights
Loan-to-value up to 80% on purchases and rate-and-term refinances, cash-out refinances available, no limit on the number of financed properties, vesting in an LLC or other entity, and eligibility for both long-term leases and short-term rentals such as Airbnb and VRBO in markets where that is permitted. Interest-only options exist for investors prioritizing cash flow. Programs vary by lender and are subject to credit approval.
Why investors use a broker for DSCR
DSCR pricing and rules differ widely between lenders: minimum ratios, prepayment-penalty structures, how short-term rental income is counted, and whether first-time investors are allowed. We place each file with the lender whose guidelines fit the deal, and we can run several scenarios (25% down vs. 30%, 30-year fixed vs. interest-only) before you commit. Closings are commonly 21–30 days.
DSCR Loan FAQs
What DSCR ratio do I need?
Most programs look for a ratio of 1.0 or higher, meaning the rent covers the full payment. Some lenders allow ratios below 1.0 with more equity. We will run your numbers before you write an offer.
Can I close a DSCR loan in an LLC?
Yes. Entity vesting is standard on DSCR programs, which is one reason investors prefer them over conventional loans.
Do DSCR loans work for Airbnb or short-term rentals?
Many do. Lenders use either the existing rental history or a short-term rent analysis. Local regulations matter, so we confirm the property is eligible before ordering the appraisal.
Is there a limit on how many properties I can finance?
No. Unlike conventional investor loans, DSCR programs generally have no cap on financed properties.
Do DSCR loans have prepayment penalties?
Often, yes, typically for the first one to five years, and the structure affects your rate. We will show you options with and without a penalty so you can choose based on how long you plan to hold.
Where do you fund DSCR loans?
Throughout California, Arizona, Colorado, Florida and Texas, from our office in San Ramon, CA.
Programs, terms and eligibility vary by lender and are subject to credit approval. This is not a commitment to lend. SiFi Lending is a mortgage broker (Simonich Financial, Inc., NMLS #2563307); we arrange loans, we do not make loans. Equal Housing Opportunity.