DSCR Loan

Is a DSCR Loan Right for You?

A DSCR (Debt-Service Coverage Ratio) loan is a commercial real estate loan designed for income-producing properties. Approval is based on the property’s ability to generate enough income to cover its debt payments.

Who Is a DSCR Loan Best For?

• Commercial Real Estate Investors
  Ideal for investors and developers financing income-generating properties.
• Income-Producing Properties
  Best for properties with strong rental income, since approval centers on the property's cash flow.
• Portfolio Expansion
  A strong option for investors aiming to acquire larger or additional investment properties.

Benefits of a DSCR Loan

• Property-Based Approval
  Focuses on the property’s income, not the borrower’s personal income or tax returns.
• Potential for Larger Loan Amounts
  Higher loan limits due to underwriting based on rental income strength.
• Flexible Repayment Terms
  Often includes longer amortization or terms tailored to cash flow.
• Supports Portfolio Growth
  Enables scaling by using the property’s performance to secure financing.

Things to Keep in Mind

• DSCR loans typically require higher down payments and may have slightly higher interest rates.
• Lenders still review creditworthiness and financial stability, even though approval is property-first.
• Investors should evaluate the property's income, expenses, and market conditions before moving forward.