Question 1

What is a DSCR loan?

Accepted Answer

A DSCR (Debt Service Coverage Ratio) loan is an investment property loan that qualifies you based on the property's rental income rather than your personal income. Lenders look at whether the property's cash flow can cover the mortgage payment—typically requiring a ratio of 1.0 or higher. No tax returns or employment verification are needed, making it ideal for real estate investors.

Question 2

How fast can I get a DSCR loan?

Accepted Answer

Pre-approval can often be delivered within 1–2 business days. From application to closing, timelines typically run 3–6 weeks depending on property type, documentation, and appraisal. We streamline processing so investors can move quickly on deals.

Question 3

Can I use a DSCR loan for a fix-and-flip or only rentals?

Accepted Answer

DSCR loans are designed for income-producing rental properties (long-term or short-term). They are not used for fix-and-flip or rehab projects where the property is not yet leased. For those strategies, you would typically use a bridge or construction loan. We focus on cash-flowing rental properties for DSCR financing.

Question 4

How many properties can I have a DSCR loan on?

Accepted Answer

There are no limits on the number of properties you can have a DSCR loan on. Grow your investment portfolio without traditional lending barriers.

Question 5

Can I get a mortgage on an investment property?

Accepted Answer

Yes, utilizing our Investor Cash Flow product allows for cash flow on the property to be used to qualify for the loan. No tax returns or employment information required.

Question 6

Is personal income required to qualify for an Investor Cash Flow Loan?

Accepted Answer

There are no personal income requirements to qualify. This saves you from submitting complicated income statements and tax returns.

Question 7

Do you offer pre-approval?

Accepted Answer

Yes, we offer pre-approval services to help you understand how much you can borrow before you start your property search.

Question 8

What types of properties qualify for DSCR loans?

Accepted Answer

DSCR loans can be used for a wide range of investment properties including single-family rentals, multi-family units, condominiums, and townhomes. The key requirement is that the property generates rental income.

Question 9

What are the minimum down payment requirements?

Accepted Answer

Down payment requirements vary based on the loan amount, property type, and DSCR ratio. On average, we see down payments ranging from 20% to 25%.

Question 10

Can I get a DSCR loan with a 680 credit score?

Accepted Answer

Yes, absolutely. A 680 credit score is more than sufficient for a DSCR loan. We work with real estate investors across a wide range of credit profiles, and a 680 score often unlocks competitive rates and terms since the primary focus is on the property's cash flow.

Question 11

Does RBJ Lending allow AirBnB income for DSCR?

Accepted Answer

Yes, we do! We understand that short-term rentals (STRs) like AirBnB and VRBO can generate significant revenue. We can evaluate your property's cash flow based on short-term rental projections or historical STR data instead of relying solely on long-term lease averages.

Question 12

Can I get a DSCR loan if my personal income is low but the property generates high cash flow?

Accepted Answer

Unlike traditional mortgages where your personal debt-to-income (DTI) ratio is heavily scrutinized, a DSCR loan relies explicitly on the cash flow generated by the investment property itself. Therefore, if your personal income is low—or even if you don't declare much income on your taxes due to deductions—you can absolutely still qualify, provided the property's gross rental income comfortably exceeds its obligations (mortgage, taxes, insurance, and HOA). This is essentially the superpower of the DSCR product for real estate investors.

Question 13

How is the DSCR ratio calculated for a multi-family property versus a single-family rental?

Accepted Answer

The formula for DSCR (Debt Service Coverage Ratio) remains the same regardless of property size: Net Operating Income divided by Total Debt Service. For a single-family home, we look at the monthly rent of the single unit against the property's mortgage payment (PITIA). For a multi-family property (e.g., a 4-plex), we aggregate the monthly rents from all units and divide that total by the property's PITIA. Because multi-family units generate redundant streams of revenue, they often provide more stabilized DSCR ratios, offering stronger protection against vacancies compared to a single-family home that might drop to 0% occupancy if the sole tenant leaves.

Question 14

What happens if the property is temporarily vacant? How do you assess the projected rent?

Accepted Answer

If you are purchasing a vacant property or refinancing a property that happens to be between tenants, we do not penalize you. Instead of looking at current lease agreements, we rely on an appraisal report that includes a Form 1007 (Single-Family Comparable Rent Schedule). The appraiser determines the market rent for the property based on similar active and recently leased rentals in the immediate area. The DSCR ratio is then calculated using this appraiser-estimated market rent.

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