Rental & refinance
DSCR Rental Loans
A DSCR loan finances an investment rental using its rental income and housing payment as the core repayment test. It can suit an investor whose tax returns do not neatly reflect the cash flow of the property being purchased or refinanced.
Who it fits
Rent-ready investment houses, condos and two- to four-unit rentals. Short-term rental eligibility depends on the lender and local use rules.
Work through the numbers
A practical example
Illustration: a $400,000 purchase at 80% LTV supports a $320,000 loan and $80,000 of purchase equity before costs and reserves. If qualifying rent is $3,000 and the lender uses a $2,400 monthly housing payment, DSCR is 1.25. The final loan must satisfy both value and cash-flow limits.
What to have ready
- Purchase contract or current mortgage statement
- Lease, rent schedule and rental history
- Entity documents, identification and liquidity statements
Questions, answered.
Start with the financing mechanics, then look at the details that can change your actual terms.
What does DSCR actually measure?
For many one- to four-unit rental programs, DSCR compares qualifying monthly rent with the mortgage payment, property taxes, insurance and association dues. Confirm the exact payment definition, especially with interest-only financing. Commercial multifamily instead usually compares net operating income with annual debt service.
Do I need tax returns or employment income?
Many DSCR programs do not qualify the loan using your personal debt-to-income ratio. They still assess the property, credit, identity, funds to close and reserves. The lender can request additional documentation; rental-income qualification is not a promise of document-free financing.
Can I finance an Airbnb or a vacant rental?
Possibly. Lenders differ on permitted short-term rental use, operating history, market-rent estimates and third-party projections. Check zoning, permits, insurance and association restrictions first. A property that needs substantial work may need bridge financing before a rental refinance.
Can I borrow in an LLC?
Entity ownership is common in business-purpose lending, but the entity must satisfy the lender’s formation and ownership requirements. A personal guarantee may still be required. An LLC alone does not make a loan non-recourse.
What should I compare beyond the interest rate?
Compare points, lender fees, prepayment penalties, reserves, fixed-rate period and whether the payment eventually increases after an interest-only period. Ask for a quote at the leverage and expected holding period you actually need.
What should I send CommFi to evaluate my scenario?
Start with the property or equipment details, transaction amount, intended use and timing. Include the documents listed above when available. CommFi can then assess the financing route and request scenario-specific terms. A pre-qualification is preliminary; appraisal, documentation and final lender approval can change the result.
Go a little deeper
Program references
Published references checked September 26, 2026. Third-party examples describe market programs and do not establish a CommFi lending relationship or guarantee availability.
Headline terms are illustrative best-case program features for qualified scenarios, not a loan offer or a confirmed CommFi lender commitment. Availability, proceeds and pricing depend on the lender, borrower, collateral and final underwriting. Maximum leverage, lowest pricing and fastest closing may not be available together.