DSCR loan calculator
Your debt service coverage ratio, monthly cash flow and the largest loan the rent supports. No sign-up. Results update as you type.
Your DSCR estimate
- DSCR (rent / PITIA)
- 1.21
- Loan amount
- $300,000
- Principal & interest
- $2,098
- Taxes, insurance, HOA
- $550
- Total payment (PITIA)
- $2,648
- Monthly cash flow (after vacancy)
- $392
- Rent needed for 1.00 DSCR
- $2,648
- Rent needed for 1.25 DSCR
- $3,310
- Max loan at 1.00 DSCR (85% LTV cap)
- $340,000
- Max loan at 1.25 DSCR (85% LTV cap)
- $287,465
- Cash to close (est.)
- $112,000
DSCR 1.21: the rent covers the full payment. Best pricing (0.8 and up).
Get my term sheetEstimate only, from the numbers you enter. Not a loan offer. Actual terms are subject to underwriting.
How to use the DSCR calculator
- Enter the purchase price (or today's value for a refinance) and your down payment.
- Enter an interest rate to test. Your real rate comes on the term sheet, the same day.
- Choose a 30-year fixed payment or interest-only.
- Add the monthly rent, yearly taxes and insurance and any HOA dues.
- Read the DSCR, the cash flow and the rent or loan size that hits 1.00 and 1.25.
- Copy the link to send the scenario to a partner or your loan officer.
How the DSCR is calculated
DSCR = monthly rent / monthly PITIA. PITIA is the full housing payment: principal, interest, property taxes, insurance and HOA dues.
Example: $3,200 rent against a $2,750 payment is a 1.16 DSCR. The property earns 16% more than its payment.
Three bands: 1.00+: the rent covers the payment. 0.80 and up: best pricing. 0.75 to 0.79: available with a pricing adjustment.
How much can I borrow on a DSCR loan?
Two limits apply. The lower one wins. The LTV limit: up to 85% of the price on a U.S. resident purchase.
80% on a rate/term refinance, 70% on a cash-out refinance and 70% for foreign nationals.
The DSCR limit: the largest payment the rent can carry. The calculator shows the loan that holds the ratio at 1.00 and at 1.25 with your rate and costs.
How to raise your DSCR
- Put more down. A smaller loan means a smaller payment.
- Choose an interest-only period to lower the monthly payment.
- Shop insurance. It is part of PITIA.
- Support a higher market rent with comparable leases.
- Buy down the rate with points when you plan to hold long term.
Worked example: one rental, three ways to finance it
A $400,000 single-family rental leases for $3,200 a month.
Taxes ($4,800 a year) and insurance ($1,800 a year) add $550 a month, with no HOA. At an assumed 7.5% rate:
| Structure | Loan | PITIA | DSCR |
|---|---|---|---|
| 25% down, 30-yr fixed | $300,000 | $2,648 | 1.21 |
| 25% down, interest-only | $300,000 | $2,425 | 1.32 |
| 15% down, 30-yr fixed | $340,000 | $2,927 | 1.09 |
All three clear 1.0. Interest-only lifts the ratio by about 0.11 and adds about $220 a month of cash flow, but pays down no principal in that period.
Putting only 15% down still qualifies, but the thinner ratio usually means a higher rate. Enter these numbers above to see each case.
DSCR for short-term rentals (Airbnb, VRBO)
Short-term rentals qualify. With 12 months of history, lenders use the actual bookings.
For a purchase or a new listing, they use a market data projection such as AirDNA, usually with a haircut for vacancy and fees.
Two things change the math. Furnishing and management costs come out of your cash flow, not the lender's DSCR. Insurance is often higher.
Enter the expected monthly average, not the peak-season month.
DSCR loan vs. conventional investment loan
| DSCR loan | Conventional | |
|---|---|---|
| Qualifies on | Property rent | Your income and tax returns |
| Close in an LLC | Yes | Usually no |
| Number of properties | No limit | Capped at 10 financed |
| Foreign nationals | Yes | Generally no |
| Rate | Somewhat higher | Lower, if you qualify |
| Prepayment penalty | Common (buys a lower rate) | None |
Strong W-2 income and few properties? A conventional loan can be cheaper.
Self-employed, buying in an LLC, past a handful of properties or not a U.S. resident? DSCR is usually the only practical option.
Reserves and cash to close
Beyond the down payment, plan for closing costs: title, appraisal, lender fees and any points, often 2 to 4% of the price.
Then reserves: cash left in the bank after closing, commonly several months of PITIA. On the example above, six months is about $15,900.
The calculator's cash-to-close line covers the down payment and closing costs. Add reserves on top.
Prepayment penalties and how they change the deal
Most DSCR loans carry a prepayment penalty: a fee if you sell or refinance in the first few years.
Common structures are 5-4-3-2-1 (5% of the balance in year one, falling each year), 3-2-1 or a flat percentage for a set period.
A longer penalty usually buys a lower rate, which lifts your DSCR. Holding five years or more? A 5-year penalty often makes sense.
Might sell or refinance sooner? Pay a bit more in rate for a shorter penalty or none. Some states limit or ban them. The term sheet accounts for it.
DSCR loans for foreign nationals
Non-U.S. residents use DSCR loans with no SSN and no U.S. credit history. The math is the same: rent compared with PITIA.
What differs is leverage (up to 70% LTV on a purchase), reserves (often more months) and paperwork.
Expect a passport, proof of funds wired from abroad and, usually, a U.S. LLC and bank account.
Use a 30% down payment in the calculator to see a foreign-national scenario, and read more on our foreign national loans page.
Common DSCR mistakes
- Leaving out HOA or flood insurance. Both are part of PITIA and can drop the ratio below 1.0.
- Using your hoped-for rent. Lenders use the lease or the appraiser's market rent, not the listing ad.
- Forgetting reserves. Most programs want several months of payments in the bank after closing.
- Counting vacancy and repairs twice. They matter for your cash flow, but the lender's DSCR uses gross rent and PITIA only.
DSCR loan requirements at a glance
DSCR loans qualify on the property, not your income: no tax returns, W-2s or pay stubs. They close in your name or an LLC.
Lenders look at the DSCR, credit, LTV, reserves (often a few months of payments), the property type and your experience.
The full checklist is in our DSCR loan requirements guide, and program terms are on the DSCR loans page.
Common questions
What is a good DSCR for a rental loan?
0.8 or higher gets the best pricing. At 1.0 the rent exactly covers the payment.
Our lenders fund down to 0.75 with a pricing adjustment. No-ratio options exist.
Which payment does DSCR use?
PITIA: principal, interest, property taxes, insurance and HOA dues. Utilities, repairs and management are not part of the lender's DSCR.
What rent counts?
The current lease, or the appraiser's market-rent estimate (form 1007) when the property is vacant or you're buying it.
Short-term rentals use AirDNA data or 12 months of history.
Does interest-only raise my DSCR?
Yes. An interest-only payment is lower than a fully amortizing one, so the same rent gives a higher ratio. Many DSCR loans come with an interest-only period.
Is this calculator a loan offer?
No. It estimates the ratio from your own numbers. Your actual rate, leverage and costs come on the same-day term sheet, subject to underwriting.