DSCR Loans

Unlock Rental Property Financing with DSCR Loans — Where Cash Flow is King.

No tax returns. No W-2s. Approval based on property performance.

What is a DSCR Loan?

A Debt Service Coverage Ratio (DSCR) loan is designed for real estate investors who want to grow their rental portfolios. Instead of relying on your personal income, lenders look at whether the property itself generates enough cash flow to cover the mortgage.

Why it matters for investors:

  • Approval based on rental income, not personal income

  • Works for 1–4 family rental properties

  • Down payment typically 20–25% (varies with credit score)

  • Perfect for scaling your portfolio

DSCR Calculator

DSCR = Gross Rent / (P&I + Taxes + Insurance + HOA)
DSCR above 1.00 means the property's income covers the debt.

Why Choose a DSCR Loan?

  • Build wealth through rental property ownership

  • Easier qualification compared to traditional loans

  • Focus on property performance, not tax returns

  • Ideal for self-employed investors or those with multiple properties

How It Works

  • 1. Find Your Property — Choose a 1–4 family rental home.

  • 2. Apply with Your Broker — Submit your DSCR loan application.

  • 3. Provide Rent Roll & Expenses — Show the property’s income potential.

    o If the property is already rented, you’ll need to provide a copy of the current lease agreement(s).

  • 4. Appraisal with Rental Market Analysis (Form 1007)

    o Appraiser estimates average market rent for similar homes.

    o Includes a vacancy factor (typically 25%) to ensure realistic projections.

  • 5. Cash Flow Test — Lender confirms rental income covers loan payments.

  • 6. Close & Collect Rent — Start earning income while your property pays for itself.

Quick FAQ (Teaser)

  • Do I need tax returns or W-2s? No — qualification is based on property cash flow.

  • How much down payment is typical? Usually 20–25%, depending on credit score.

  • What if the property is already rented? You’ll need to provide a copy of the current lease agreement(s).

First-Time Investor Advantage

Taking the leap into real estate investing can feel intimidating — especially if you’re worried about proving your personal income. With a DSCR loan, that barrier is removed. Approval is based on the property’s ability to generate rental income, not your paycheck.

This means:

  • You don’t need to show tax returns or W-2s.

  • The property itself is the proof of value.

  • Rental income becomes your pathway to building wealth.

Encouragement for new investors: Your first rental property isn’t just an investment — it’s a business that generates income month after month. With the right property, you can create steady cash flow and start building long-term financial security without the stress of traditional income requirements.

Success Story: From First-Time Investor to

Cash-Flow Positive

“If the property pays for itself, you can own it. That’s the power of DSCR loans.”

Michael’s Journey When Michael, a self-employed consultant, wanted to buy his first rental property, he worried that traditional lenders would reject him because he didn’t have W-2 income or tax returns showing steady earnings. Instead of giving up, he explored a DSCR loan.

  • Found a duplex in a growing neighborhood

  • Applied for a DSCR loan with his broker

  • Appraisal included a Rental Market Analysis (Form 1007) with a 25% vacancy factor

  • Rental income exceeded the mortgage payment — meeting the DSCR requirement

  • Closed with a 25% down payment

The Result Today, Michael’s duplex is fully rented. The monthly rental income not only covers the mortgage but also generates positive cash flow. He’s already planning to purchase a second property using the same DSCR loan strategy.

Build Wealth Through Real Estate

Refinancing can also be a strategic move to grow your wealth. By unlocking the value in your home, you may be able to access funds for a down payment on a second home or investment property—like a rental. Whether you're looking to generate passive income or build long-term financial security, refinancing could be the first step toward expanding your real estate portfolio.

Common DSCR Loan Questions and Answers

Q: What does DSCR mean?

DSCR stands for Debt Service Coverage Ratio. It measures whether rental income can cover the mortgage payment.

Q : How much down payment is required?

Typically 20–25%, but ranges from 15–30% depending on your credit score.

Q: Do DSCR loans require an appraisal?

Yes. The appraisal includes a Rental Market Analysis (Form 1007) to estimate average rents and applies a vacancy rate (commonly 25%) to ensure cash flow is realistic.

Q: If my property is already rented, what documents are needed?

You’ll need to provide a copy of the current lease agreement(s) to verify rental income.

Q: Do I need to show personal income or tax returns?

No. Qualification is based on property cash flow, not personal income.

Q: What types of properties qualify?

1–4 family rental properties.

Why Work With Us

At Nicole Stock Lending, we believe every investor deserves a trusted partner who understands both the numbers and the vision. With years of experience helping clients refinance, purchase, and grow their portfolios, we bring:

  • Proven Expertise — Decades of combined mortgage industry knowledge

  • Personalized Guidance — Tailored solutions for first-time and seasoned investors

  • Investor-Focused Approach — We prioritize cash flow and long-term wealth creation

  • Trusted Reputation — Known for transparency, responsiveness, and results

Our mission: To simplify the lending process and empower investors to achieve financial freedom through real estate.

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Copyright ©2021 | The Nicole Stock Lending

Licensed to Do Business | NMLS# 2285676


This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates and programs are subject to change without notice. All products are subject to credit and property approval. Other restrictions and limitations may apply. Copyright © 2021 | NEXA Mortgage


Corporate | NMLS ID NMLS# 1660690

Corporate Address : 5559 S Sossaman Rd, #1-101 Mesa, AZ 85212

Corporate NMLS NMLS# 1660690 | Company Website: https://nexamortgage.com

Copyright ©2021 | The Nicole Stock Lending | NMLS# 2285676

Licensed to do business in.. Florida · Wisconsin · North Dakota · Arizona · Minnesota

This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates and programs are subject to change without notice. All products are subject to credit and property approval. Other restrictions and limitations may apply

Corporate | NMLS ID NMLS# 1660690

Corporate Address : 5559 S Sossaman Rd, #1-101 Mesa, AZ 85212 https://nexamortgage.com