DSCR Loans in Florida for Investment Properties

A DSCR loan in Florida is an investment property mortgage that allows real estate investors to qualify using rental income instead of personal tax returns. This loan program is commonly used for long-term rental and short-term investment properties, making it a popular option for Florida real estate investors who want a simpler qualification process.

Instead of using personal income, DSCR loans are underwritten based on a property’s projected rental income, which helps lenders evaluate whether the property can support the monthly mortgage payment.

Take the gross rents of a property and divide it by the monthly mortgage payment (principal, interest, taxes, and insurance). The result is a percentage that is used to determine an investor’s ability to repay the loan. This calculation is called the “debt service coverage ratio,” hence the namesake, and is why income does not need to be verified.

Less documentation makes the underwriting process significantly easier.

Since DSCR is an alternative solution engineered specifically with real estate investors in mind, it has more features besides simplifying the lending process.

Some other benefits of a DSCR loan are:

• Finance up to 20 properties
• Can close in a business name (e.g., LLC)
• Up to $2.5 million loan amount
• Interest-only options available

For real estate investors and self-employed borrowers, the DSCR program might be the ideal solution for those who have previously experienced discouraging loan processes.