DSCR Loans for Buying a Rental Property
A DSCR purchase loan lets you buy an investment property and qualify based on the rent the property is expected to generate, rather than your personal income or tax returns. It is a popular option for self-employed investors and for investors adding properties to a growing portfolio. Kala Lending LLC shops purchase financing across multiple lenders to find terms that fit your deal.
How Qualifying Works
The lender compares the property’s rental income, from a current lease or the appraiser’s market rent schedule, with the monthly payment: principal, interest, taxes, insurance, and any association dues (PITIA). That ratio is the debt service coverage ratio, or DSCR. Our DSCR Loans page explains how it is calculated.
Properties You Can Finance
- Single-family rentals
- 2-4 unit properties
- Condos and townhomes
- Short-term rentals, where the program allows
What Lenders Typically Look For
- Down payment: investor purchase loans usually require more down than owner-occupied loans
- Credit score: higher scores generally earn better pricing
- Cash reserves: proof of funds to cover several months of payments
- Appraisal and rent schedule: to confirm value and market rent
- Purchase contract: the signed agreement and your closing date
Frequently Asked Questions
Can I buy in an LLC? Often yes, depending on the lender. Guarantor requirements vary.
Do I need landlord experience? Some programs accept first-time investors, while others ask for a track record. Requirements vary by lender.
How fast can I close? Timelines depend on the appraisal, title, and the lender. Tell us your closing date when you submit your deal so we can match you with lenders that can meet it.
Run Your Purchase Scenario
Contact Kala Lending or submit your deal.
Kala Lending LLC is a mortgage broker and not a direct lender. Loans are offered through third-party lenders. Loans are for business or investment purposes only and are not for personal, family, or household use. All loans are subject to underwriting approval. Rates, terms, leverage, and availability vary by lender, borrower, property, and state. This is not a commitment to lend or a rate quote.
Related pages: DSCR Loans | Cash-Out Refinance | Rate and Term Refinance | Delayed Financing | All Loan Programs