What Type of Properties Can I Finance with a DSCR Loan?
A DSCR (Debt Service Coverage Ratio) loan can be used to finance a wide range of investment property types — from long-term rentals to short-term vacation properties.
This flexibility makes DSCR loans one of the most powerful financing tools available to real estate investors.
🏠 Eligible Property Types
Here are the most common property types that can be financed with a DSCR loan:
Single-Family Homes
Perfect for traditional long-term rental strategies.
Condos & Townhomes
Great for investors in high-demand urban or resort markets.
2–8 Unit Multifamily Properties
Ideal for small apartment buildings and duplex/triplex investors.
Short-Term Rentals (Airbnb, VRBO)
DSCR loans can qualify based on projected or actual Airbnb income.
Mixed-Use Properties (case-by-case)
Some lenders allow partial commercial use, such as a retail + apartment setup.
💰 How Property Type Affects Your DSCR
Property Type | Typical LTV | DSCR Requirement | Notes |
Single-Family | Up to 80% | 1.0 – 1.25 | Easiest to finance |
2–4 Units | Up to 75% | 1.10 – 1.25 | Slightly stricter ratios |
5–8 Units | Up to 70% | 1.15 – 1.30 | May require commercial underwriting |
Short-Term Rental | Up to 75% | 1.10 – 1.25 | Based on average occupancy data |
Higher DSCR ratios generally lead to better loan terms and lower rates.
⚡ Why DSCR Loans Are Ideal for Investors
You can hold multiple investment properties without personal income verification.
No limit on how many DSCR-financed properties you can own (depends on lender).
Works for both purchase and refinance scenarios.
LLCs and corporations are fully eligible to hold title and borrow.
🧩 Common Scenarios
Expanding your rental portfolio
Buy a new property using the cash flow from the rent to qualify.
Refinancing an existing investment
Pull equity or lower your payment without W-2 income.
Financing Airbnb or short-term rentals
Use projected rental data to qualify even if the property is newly listed.