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What is a DSCR loan?
A DSCR loan, or debt service coverage ratio loan, is an investment property mortgage that evaluates a property's cash flow relative to its debt obligations. These loans are commonly used by real estate investors purchasing or refinancing income-producing properties.
Who are Home Investor Advantage and DSCR loans for?
Real estate investors growing their portfolios
Is your personal income already committed to another property? A DSCR loan may help you finance additional rental properties by qualifying primarily on the income each property is expected to generate.
First-time investors
If you’ve been considering investing in real estate, DSCR loans are a great tool to get started.
Investors looking to refinance
You may be able to use a DSCR loan to refinance an existing rental property, adjust your loan terms, improve cash flow, or access equity for future investments.
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DSCR loan requirements and benefits
See what a DSCR loan can do for you, and what's still checked, before you talk numbers.
Qualify on the property's potential rent
The loan looks mainly at what the rental earns, not your personal income.
Room to keep growing
Helpful when the loans you already carry make a standard investment loan harder.
Built for rentals
Made for homes you rent out, from your first rental to your tenth.
Rent that covers the payment
The higher the rent compared with the monthly payment, the stronger the loan. Your loan officer will tell you what each program needs.
Credit and savings
Lenders still check your credit and want savings left after closing, often called reserves.
An appraisal of the property
The appraisal confirms the home's value and what it could rent for.
Compare side by side
DSCR loans vs standard investment loans
Both finance rentals. The difference is how you qualify.
Standard investment loan
Qualifies on your personal income.
You qualify on
- Your income and debts
Documents
- Tax returns and pay records
Best for
- Investors whose returns show their full income
DSCR loan
Qualifies mainly on the property's rent.
You qualify on
- The rent compared with the payment
Documents
- Lease or rent estimate, plus credit and savings
Best for
- Investors with write-offs or several loans
Tools & Calculators
Use our mortgage calculators to estimate payments, compare options, and make a more informed decision before your next move.
FAQs about loans for Home Investor Advantage (DSCR Loans)
Whether you’re exploring your options, already have a loan with Fairway, or need help finding the right place to go, connect with a loan officer to point you in the right direction.
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A DSCR loan focuses primarily on the rental income generated by the investment property rather than your personal income. Because qualification is based on the property’s cash flow, traditional income documentation such as tax returns, W-2s and pay stubs may not be required.
It depends on the loan program and your specific scenario. Fairway currently offers DSCR options with minimum ratios ranging from 0.75 to 1.25. A ratio of 1.00 means the property generates enough qualifying rental income to cover its applicable debt obligations.
Yes, eligible short-term rentals, including properties using rental platforms, may qualify. Requirements vary by program, and some options place additional restrictions on short-term rental income or investor experience.
The biggest difference is how you qualify. Traditional financing generally considers the borrower’s personal income and financial profile, while a DSCR loan focuses primarily on the investment property’s ability to generate enough rental income to cover its debt obligations.
Requirements vary based on the loan program and factors such as loan amount, property type and transaction.
Yes. Fairway currently has DSCR options that allow eligible investment properties to be vested in an LLC. Specific LLC and business-purpose requirements can vary by program.
Nothing. Home Investor Advantage is what we call DSCR loans at Fairway.
Ready to see if Home Investor Advantage is the right fit?
It starts with a conversation. Tell us about the property and the rent. Your local Fairway loan officer will reach out and walk you through your options.
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