Debt Service Coverage
Ratio (DSCR) Loans
Qualify based on rental income — not personal income.
We connect real estate investors with our trusted DSCR lending partner for 30-year rental financing.
Important: REIA Hard Money does not originate or service DSCR loans. We guide you through the process and connect you with our trusted third-party DSCR lender. You do not need to have completed a hard money loan with REIA Hard Money to request a DSCR referral. Our goal is to support real estate investors throughout Wisconsin with resources beyond short-term financing. When you submit this form, a trusted third-party DSCR lender will reach out to you directly. REIA Hard Money is not involved in the DSCR loan process or decision-making.
What is a DSCR Loan?
A DSCR (Debt Service Coverage Ratio) loan is a type of long-term (generally 30-year) investor mortgage where approval is based primarily on whether the property’s rental income can support the monthly loan payment.
Unlike traditional financing, DSCR loans do not rely on W-2 income, tax returns, or employment history. Instead, underwriting focuses on the income-producing ability of the property itself.
Most DSCR loans are structured with a 30-year term and full amortization, allowing investors to lock in predictable monthly payments and optimize cash flow over the long term.
DSCR loan approval is typically based on:
- Expected or in-place rental income
- Property performance and cash flow
- Overall deal strength
- Borrower credit score
- Property value
How will Amortization be impacted by using a DSCR Loan?
Amortization helps DSCR loans by allowing investors to choose longer terms (generally 30 years), which spreads principal repayment, significantly lowering monthly payments and increasing the DSCR ratio (NOI/Debt Service) to meet lender requirements, making the property appear more financially viable and less risky. A longer amortization period reduces the "Annual Debt Service" in the DSCR formula, boosting the ratio above the typical 1.20x minimum lenders demand.
This makes DSCR loans ideal for:
- Buy-and-hold investors
- Borrowers looking to unlock equity with a cash out refinance
- BRRRR investors ready to finance
- Rental property owners growing a portfolio
- Investors who prefer income-based underwriting
- Borrowers looking to refinance multiple properties at one time
How to Get the Best DSCR Rate
It comes down to four main factors: Credit Score, Leverage/LTV, Loan Amount, and Debt Service Coverage Ratio (DSCR).
| Rate Possibility | Credit Score | Leverage/LTV | Loan Amount | DSCR |
|---|---|---|---|---|
| Options Available but with Higher Rates | 680-719 | 80% | $50,000-$99,999 | 1.00x to 1.19x |
| Good Rate Possible | 720-739 | 75% | $100,000-$199,999 | 1.00x to 1.19x |
| Very Good Rate Possible | 740-779 | 70% | $200,000-$299,999 | 1.00x to 1.19x |
| Great Rate Possible | 780+ | 65% or less | $300,00+ | 1.20x or more |
How DSCR Loans Are Commonly Used
DSCR loans are often used as the long-term financing solution after a property has been purchased and stabilized.
A typical strategy may include:
- Buying a property
- Renovating and renting it
- Refinancing into a DSCR loan
- Holding long-term or repeating the process
REIA Hard Money helps investors understand when a DSCR loan is the right fit and connects them to a lender who specializes in this type of financing.
How the Process Works
Submit Your Information
Complete our DSCR Lead Intake Form so we can understand your goals and property details.
We Make the Connection
We connect you with our trusted third-party lender who specializes in DSCR loans.
DSCR Loan Review & Approval
The lender evaluates the deal based on rental income, property type, and loan structure.
Close & Scale
Once approved, you close on long-term financing and continue building your rental portfolio.
Benefits of DSCR Financing
- Simplified qualification for real estate investors
- Allows investors to scale without income limitations
- Keeps personal finances separate from investment properties
- Supports long-term rental wealth building
- Ideal for investors refinancing out of short-term financing
- Unlock equity with a cash out refinance
Frequently Asked Questions
What is a DSCR loan?
A DSCR (Debt Service Coverage Ratio) loan is a type of investment property loan that is underwritten primarily based on the rental income of the property rather than the borrower’s personal income.
Does REIA Hard Money offer DSCR loans directly?
No. REIA Hard Money does not originate or service DSCR loans. We connect investors with our trusted third-party lender that specializes in DSCR financing.
What types of properties qualify for DSCR loans?
DSCR loans are commonly used for single-family rentals, small multifamily properties, and certain short-term or vacation rentals, depending on the lender’s guidelines.
Do DSCR loans require W-2 income or tax returns?
Typically, DSCR loans do not require W-2 income or employment verification. Approval is based primarily on rental income and property performance.
When should an investor consider a DSCR loan?
Investors often use DSCR loans when refinancing a stabilized rental property or when acquiring a long-term buy-and-hold investment.
Can I do a DSCR loan with REIA Hard Money's DSCR Partner if I haven't done my hard money loan with REIA Hard Money?
Yes, we refer many folks needing only a DSCR loan to our DSCR Partner. Fill out our DSCR Loan Intake Form to be referred to our trusted partner.
DSCR Loans for Real Estate Investors
REIA Hard Money works with real estate investors throughout the state of Wisconsin who are seeking long-term rental financing through DSCR loans. Wisconsin’s strong rental demand, aging housing stock, and mix of single-family and small multifamily properties make DSCR financing a popular option for investors focused on buy-and-hold and portfolio growth strategies. While REIA Hard Money does not originate DSCR loans, we connect Wisconsin investors—and investors in all other states—with our trusted third-party lending partner that specializes in DSCR financing for rental properties.
Start Your DSCR Loan Referral Today!
Complete our DSCR Lead Intake Form, and we’ll help connect you with our trusted third-party
DSCR lender that specializes in investor financing.
