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DSCR Loans
Qualify based on the property's rental income—not your personal income, tax returns, or W-2s. Built specifically for real estate investors who want to scale without the paperwork headaches.
Who Is This Loan For?
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✅ Real estate investors (first-time and experienced)
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✅ Investors who don't want to use personal income documentation
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✅ Portfolio builders scaling across multiple properties
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✅ Self-employed investors with complex tax returns
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✅ Buyers purchasing single-family, multi-family, or commercial properties
What Is a DSCR Loan?
DSCR stands for Debt Service Coverage Ratio.
It's a simple formula:
DSCR = Property's Gross Rental Income ÷
Total Monthly Mortgage Payment
Instead of looking at your personal income, pay stubs, or tax returns, a DSCR loan qualifies you based on whether the property generates enough income to cover the mortgage payment.
Example:
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Property's monthly rental income: $2,000
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Monthly mortgage payment (principal, interest, taxes, insurance): $1,600
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DSCR = $2,000 ÷ $1,600 = 1.25
A DSCR of 1.25 means the property generates 25% more income than the mortgage costs. That's a strong deal.
At Team Malik, we require a minimum DSCR of 0.75 (75%)—meaning the property only needs to cover 75% of the mortgage payment to qualify. This opens the door for properties in high-appreciation markets where rents haven't fully caught up to values yet.
We work as both a direct lender and a broker, so we can shop multiple DSCR programs to find you the best rate and terms. Licensed in Florida, New Jersey, and Pennsylvania—all markets, all property types.
DSCR Loan Requirements
DSCR Ratio
Minimum 0.75 (75%). This applies to single-family, multi-family, and commercial properties across all markets we serve. A ratio of 1.0+ is ideal, but we can work with properties that don't fully cover the payment yet.
Credit Score
680+ is the typical minimum. Higher scores unlock better rates and terms. Most of our investor clients are in the 700–740 range.
Down Payment
20–25% depending on the property type, DSCR ratio, and credit score. Stronger profiles (higher DSCR, higher credit) can sometimes qualify at the lower end.
Income Verification
None. That's the whole point. No W-2s, no tax returns, no pay stubs, no DTI calculation. Qualification is based entirely on the property's cash flow.
Market Rent Analysis
A rent analysis (Form 1007 or similar) is required to verify the property's rental income potential. If the property is already rented, we can use the existing lease.
Property Types
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Single-family homes
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Multi-family (2–4 units and 5+ units)
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Condos and townhomes
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Short-term rentals (Airbnb/VRBO) — in many cases
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Commercial properties
DSCR vs. Conventional: Quick Comparison
If you're an investor and you don't want your personal income scrutinized—or if your tax returns don't reflect your true earning power—DSCR is the move. If you're buying a primary residence, conventional or FHA is the way to go.
How the DSCR Loan Process Works
Step 1 — Pre-Qualification
We review your credit, target property type, and investment goals. No income docs needed at this stage. You'll know your buying power within 1–2 business days.
Step 2 — Find Your Property
Identify the investment property. If you already have one under contract, even better—we can move fast.
Step 3 — Rent Analysis
We order a market rent analysis to verify the property's income potential. If there's an existing lease, we use that. This determines your DSCR ratio.
Step 4 — Appraisal
An appraiser confirms the property's market value. For multi-family and commercial, this may include an income approach valuation.
Step 5 — Underwriting & Closing
Underwriting focuses on the property's numbers, not yours. Less back-and-forth, fewer document requests. Typical timeline: 21–35 days. Need to close faster to beat another offer? Ask about our 25-day guaranteed close.
Frequently Asked Questions
What does DSCR stand for?
Debt Service Coverage Ratio. It measures whether a property's rental income covers the mortgage payment. A DSCR of 1.0 means the rent exactly covers the payment. Above 1.0 means positive cash flow. Below 1.0 means the rent doesn't fully cover the payment.
What's the minimum DSCR ratio you accept?
0.75 (75%). This means the property only needs to generate 75% of the mortgage payment in rental income to qualify. This is more flexible than many lenders who require 1.0 or higher.
Do I need to show any personal income?
No. DSCR loans are qualified entirely on the property's cash flow. No W-2s, no tax returns, no pay stubs, no personal DTI calculation.
Can I use a DSCR loan for a short-term rental (Airbnb)?
In many cases, yes. We can use projected short-term rental income based on market data. Requirements vary—let's discuss your specific property.
Can I use DSCR to buy multiple properties?
Absolutely. There's no limit on the number of DSCR loans you can have. Many of our investor clients use DSCR to scale their portfolios across FL, NJ, and PA without their personal DTI becoming a bottleneck.
What if the property isn't rented yet? No problem. We use a market rent analysis to determine what the property would rent for. You don't need a tenant in place at closing.
Can I use DSCR for a commercial property?
Yes. DSCR works for single-family, multi-family, and commercial properties across all markets we serve.
How is DSCR different from a bank statement loan?
DSCR qualifies you based on the property's income. Bank statement loans qualify you based on your personal bank deposits. If you're buying an investment property, DSCR is usually the better fit. If you're self-employed and buying a primary residence, bank statement is the way to go.
Explore Other Loan Options
FHA Loans → Low down payment and flexible credit. Great for first-time buyers.
DSCR Loans → Qualify on rental income. Built for investors.
Bank Statement Loans → Self-employed? Use your deposits to qualify.