DSCR Loan Guide: No Income Mortgage Loan for Multi-Unit Rental Properties
Investing in multi-unit rental properties can be a lucrative strategy for generating passive income, but securing financing can be a major hurdle—especially for borrowers who don’t have traditional income documentation. This is where Debt Service Coverage Ratio (DSCR) loans come in. These no-income verification loans allow real estate investors to qualify for financing based on their property’s rental income rather than personal income.
In this guide, we’ll break down everything you need to know about DSCR loans for multi-unit rental properties, including:
✅ What DSCR Loans Are & How They Work
✅ Who Qualifies for a DSCR Loan
✅ Key Benefits of No-Income DSCR Loans
✅ DSCR Loan Requirements & Terms
✅ Step-by-Step Process to Secure a DSCR Loan
✅ Where to Find DSCR Loan Lenders
By the end of this guide, you’ll have a clear roadmap for using a DSCR loan to finance your next multi-unit rental property—without the hassle of proving personal income.
What Is a DSCR Loan?
A Debt Service Coverage Ratio (DSCR) loan is a no-income mortgage designed for real estate investors. Instead of using personal income (W-2s, tax returns, or pay stubs), lenders determine eligibility based on the property’s rental income compared to the debt obligations.
How DSCR Works
Lenders use the Debt Service Coverage Ratio (DSCR) formula to assess a property’s ability to cover its mortgage payments:
[
DSCR = \frac{\text{Gross Rental Income}}{\text{Monthly Debt Obligations (PITI)}}
]
- A DSCR of 1.0 means the property breaks even (rental income = mortgage payment).
- A DSCR above 1.0 means the property generates positive cash flow.
- A DSCR below 1.0 means the property does not generate enough income to cover the mortgage.
Most DSCR lenders require a minimum ratio of 1.0 to 1.25, but some offer No-Ratio DSCR Loans, which means they don’t require a minimum DSCR.
Who Qualifies for a DSCR Loan?
DSCR loans are ideal for:
✔ Real estate investors with multiple rental properties
✔ Self-employed borrowers with complex tax returns
✔ Foreign investors with no U.S. income history
✔ Retirees investing in rental properties
✔ House flippers & Airbnb hosts looking for easy financing
Unlike traditional mortgages, DSCR loans allow investors to qualify based on rental income alone, making them an excellent option for those who may have high expenses, tax write-offs, or variable income.
Key Benefits of DSCR No-Income Mortgage Loans
✅ No Income Verification Required
You don’t need tax returns, W-2s, pay stubs, or employment verification to qualify.
✅ Fast & Streamlined Approval Process
DSCR loans close much faster than conventional loans, often within 2 to 4 weeks.
✅ Ideal for Multi-Unit Properties
DSCR loans work well for duplexes, triplexes, fourplexes, and large apartment buildings.
✅ Use for Airbnb & Short-Term Rentals
Many DSCR lenders allow vacation rentals, Airbnbs, and short-term rental income to qualify.
✅ Finance LLC-Owned Properties
Unlike traditional loans, DSCR lenders allow purchasing or refinancing under an LLC for asset protection.
✅ Flexible Property Types
DSCR loans can finance:
✔ Single-family rentals (SFRs)
✔ Multi-unit buildings (2-4 units, 5+ units)
✔ Mixed-use properties
✔ Airbnbs & short-term rentals
✔ Condos & townhomes
✅ No Limits on the Number of Mortgages
Traditional loans limit the number of financed properties (often 10). DSCR loans allow unlimited rental properties.
DSCR Loan Requirements & Terms
Lenders offering DSCR loans each have different requirements, but here’s what to expect:
1. Credit Score Requirements
- Minimum credit score: 680+
- Some lenders may accept 620+ with higher rates
2. Loan-to-Value (LTV) Limits
- Purchase: Up to 80% LTV
- Refinance: Up to 75% LTV
- Cash-Out Refinance: 65-70% LTV
3. DSCR Ratio Requirements
- Typical minimum DSCR: 1.0 – 1.25
- No-Ratio DSCR Loans available (ideal for properties not yet generating rental income)
4. Loan Amounts
- Minimum: $100,000
- Maximum: $5M+ (depends on lender)
5. Loan Terms
- Interest Rates: Typically prime + 1-2%
- Fixed & Adjustable-Rate Options available (5/1 ARM, 30-year fixed, etc.)
- Prepayment Penalties May Apply (Check lender terms)
6. Property Appraisals
- Desktop or Full Appraisal Required
- Rent schedule (Form 1007) may be needed to estimate rental income
7. Down Payment Requirements
- Typically 20-25% down for purchases
- Lower down payments may be available for strong borrowers
How to Get a DSCR Loan for Multi-Unit Rental Properties
If you’re interested in securing a DSCR no-income loan, follow these steps:
Step 1: Check Your Credit Score
Ensure you meet the minimum credit score requirement (typically 680+).
Step 2: Estimate Your DSCR Ratio
Use this formula:
[
\text{DSCR} = \frac{\text{Monthly Gross Rent}}{\text{Monthly Mortgage Payment (PITI)}}
]
If your DSCR is 1.0 or higher, you’ll likely qualify. If below 1.0, look for a No-Ratio DSCR loan.
Step 3: Gather Property Information
Lenders will ask for:
✔ Property address & type
✔ Lease agreements (if applicable)
✔ Current rent roll or rental income estimate
Step 4: Apply with a DSCR Lender
Since banks don’t offer DSCR loans, work with a private lender, mortgage broker, or direct non-QM lender specializing in investor loans.
Step 5: Get an Appraisal & Approval
Lenders will order an appraisal and rent schedule to confirm property value and rental income.
Step 6: Close & Fund Your Loan
Once approved, DSCR loans fund within 2 to 4 weeks—much faster than conventional loans.
Where to Find DSCR Loan Lenders
Since traditional banks don’t offer DSCR loans, you’ll need to work with:
✔ Direct private lenders
✔ Mortgage brokers specializing in investor financing
✔ Hard money lenders (short-term DSCR options)
✔ Online non-QM mortgage lenders
Final Thoughts: Is a DSCR Loan Right for You?
If you’re a real estate investor looking for a simple, fast, and no-income verification mortgage, a DSCR loan can be an excellent solution. These loans allow you to qualify based on rental income, making them ideal for multi-unit rental property investors who prefer hassle-free financing.
🚀 Looking to finance your next rental property? Start exploring DSCR loan options today! 🚀
Unlock Opportunities with GHC Funding’s No Income Verification Mortgage Loan for Multi-Unit Rental Properties
Investing in multi-unit rental properties can be a lucrative venture, but securing traditional financing often comes with hurdles that can slow down your progress. If you’re an investor or property owner tired of jumping through hoops to verify your income, GHC Funding has the perfect solution for you. We are proud to offer No Income Verification Mortgage Loans tailored specifically for multi-unit rental properties.
This innovative loan product is designed to help you focus on what matters most—growing your portfolio—without the hassle of extensive documentation. Here’s why this financing option could be the game-changer you’ve been looking for:
What Is a No Income Verification Mortgage Loan?
A No Income Verification Mortgage Loan allows borrowers to qualify for financing without having to provide proof of income, such as tax returns, pay stubs, or W-2 forms. Instead, these loans focus on other financial metrics, such as the property’s rental income potential or the borrower’s creditworthiness. This streamlined approach removes barriers for investors who may have complex or non-traditional income sources.
Why Choose GHC Funding?
At GHC Funding, we understand the unique challenges that real estate investors face. Our No Income Verification Mortgage Loans are specifically crafted to simplify the financing process for multi-unit rental properties, allowing you to seize opportunities faster and with greater flexibility.
Here’s what makes our program stand out:
- No Proof of Income Required: Forget the hassle of digging up endless documents. We make it easy for you to qualify without providing traditional income verification.
- Focus on Property Performance: Instead of scrutinizing your personal income, we focus on the rental income potential of your multi-unit property. This approach puts the emphasis where it belongs—on your investment!
- Competitive Rates: Despite the streamlined process, GHC Funding offers competitive interest rates, ensuring you can maximize your cash flow.
- Fast Approval Process: Time is money, and we move quickly to get you the funding you need for your next investment opportunity.
Who Can Benefit?
Our No Income Verification Mortgage Loans are ideal for:
- Experienced investors looking to expand their portfolio.
- Self-employed individuals who have non-traditional income streams.
- Property owners seeking refinancing options without the hassle of income documentation.
- First-time investors who want to bypass the complexities of traditional loans.
Whether you’re acquiring new multi-unit rental properties or refinancing existing ones, GHC Funding is here to support your real estate ambitions.
Why Multi-Unit Rental Properties?
Multi-unit rental properties offer a unique advantage in the real estate market. With multiple rental streams from a single property, these investments often provide higher returns and more stable cash flow compared to single-family homes. They are an excellent choice for investors seeking long-term financial growth and operational efficiency.
Take the Next Step Today
Don’t let income verification requirements hold you back from achieving your real estate goals. With GHC Funding’s No Income Verification Mortgage Loan, you can focus on building your portfolio and generating rental income without unnecessary delays or complications.
Contact us today to learn more about how our program can help you turn your investment dreams into reality. Let GHC Funding be your trusted partner in unlocking the full potential of multi-unit rental properties!
