You’ve probably heard other investors bragging about buying rentals with “no tax returns” and “no personal income verification.”
Sounds too good to be true… but it’s not.
It’s called a DSCR loan — and right now, it’s the fastest way for serious investors to scale without hitting the Fannie Mae 10-property wall.
Here’s everything you actually need to know
What is a DSCR loan?
Debt Service Coverage Ratio loan = a mortgage that qualifies based on the property’s rental income instead of your personal income.
Translation: If the rent covers the mortgage payment (and ideally leaves cushion), you’re approved. Your W-2s, paystubs, and tax returns never even hit the underwriter’s desk.
The Simple Math
DSCR = Monthly Rent ÷ Monthly PITIA (Principal + Interest + Taxes + Insurance + HOA)
Examples:
→ Rents $4,000 | PITIA $4,000 → DSCR = 1.00 → Approved at most lenders
→ Rents $4,000 | PITIA $3,200 → DSCR = 1.25 → Golden (lower rate, better terms)
→ Rents $4,000 | PITIA $5,000 → DSCR = 0.80 → Still possible with certain lenders
Who this is actually built for
- Self-employed investors who write everything off (and look “poor” on paper)
- Anyone who already owns 5–10+ financed properties
- Short-term (Airbnb/VRBO) rental buyers
- Investors who want to close in an LLC
- People who are tired of hearing “your DTI is too high” from banks
Typical Requirements Today (February 2026)
- 20 % down (25%+ down receive better rates / terms)
- Credit score 680+ gets the best rates (we have options down to 620)
- 6–12 months reserves in the bank
- Long-term or short-term rental income both accepted
- Loan amounts all the way to $6 million on strong deals
$1,900,000 ocean front in Surf City, NC
$1,200,000 DSCR loan (1031 exchange)
Rents: $12,000 (monthly short-term estimated rents)
New Payment: $9,700
DSCR: 1.23
Rate: 6.5% 30-year fixed (no prepay)
Client now owns 8 properties at the beach, a portfolio of long-term rentals and is currently renting the subject property for $20k a week.
Bottom Line
If your deals cash-flow and you have decent credit and a down payment, there’s never been a better time to use DSCR financing. Rates are the lowest they’ve been in 4 years and guidelines are still investor-friendly.
Let’s make sure your next rental actually gets funded. Contact your Scout Advisors mortgage expert today!
Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Refinancing your mortgage may increase costs over the term of your loan. Savings, if any, vary based on the consumer’s credit profile, interest rate availability, and other factors. Programs and interest rates are subject to change without notice. Contact your Scout Advisors mortgage expert for current rates and to confirm program eligibility.
