A good fit if…
- You’re buying or refinancing a rental property
- Your tax returns don’t show your real cash flow
- You want to close in an LLC
- You own several properties and want to keep growing
How the math works
Lenders divide the property’s monthly rent by its full monthly payment, including principal, interest, taxes, insurance and any HOA dues. A ratio of 1.0 means the rent exactly covers the payment. Most lenders want to see 1.0 or higher, and a stronger ratio usually means better pricing. Some lenders will go below 1.0 with a larger down payment.
The DSCR calculator will show you where a property lands before you make an offer.
Short-term rentals in Arizona
Scottsdale, Sedona, Flagstaff and parts of Phoenix are popular short-term rental markets. Some DSCR lenders will use projected short-term rental income from a market report, while others only use long-term rent. Arizona cities can also require short-term rental permits or licenses, so check local rules before you count on that income.
What lenders look for
- The DSCR ratio itself
- Your credit score
- Cash reserves after closing
- Your experience as an investor (helpful, not always required)
- The property’s condition and rentability, confirmed by the appraisal and a rent survey
Many DSCR loans include a prepayment penalty for the first few years. Ask about it upfront if you might sell or refinance soon.
Run the numbers
Common questions
Can I get a DSCR loan for my first investment property?
Often, yes. Some lenders require prior experience, but many don’t. Pete will match you with one that fits.
Can I use a DSCR loan to buy a home I’ll live in?
No. DSCR loans are for investment properties only. For a home you’ll live in, look at conventional, FHA or VA.
Can I close a DSCR loan in my LLC?
Yes. Most DSCR lenders allow vesting in an LLC, usually with a personal guarantee.
This page is general information, not a loan offer, rate quote or commitment to lend. Program guidelines, loan limits and assistance programs change; figures shown are as of 2026. Eligibility, down payment and terms depend on your credit, income, property and the program. Ask Pete for current details.