DSCR loans in Texas
Qualify on the property's rent, not your income. Up to 85% LTV for U.S. residents, 70% for foreign nationals.
Term sheet the same business day. Flipping? Fix-and-flip loans statewide.
Texas rental markets at a glance
Typical home value and rent by metro, with the gross rent yield: a year of rent divided by the value.
Higher yield means less money down to reach a 0.8 DSCR, where the best pricing starts. Each link opens the DSCR calculator with that market's numbers.
| Metro | Typical home value | Typical rent | Gross yield | Down for best pricing | |
|---|---|---|---|---|---|
| Houston | $302,832 | $1,638/mo | 6.5% | 30% | Run the DSCR |
| San Antonio | $273,806 | $1,415/mo | 6.2% | 35% | Run the DSCR |
| Dallas-Fort Worth | $358,242 | $1,659/mo | 5.6% | 40% | Run the DSCR |
| Austin | $414,273 | $1,603/mo | 4.6% | 55% | Run the DSCR |
Metro-level typical values and rents, September 2026. The down payment column and the calculator link assume a 7.5% rate, a 30-year payment and $1,800 a year insurance. Change them to match your deal.
Texas property taxes and your DSCR
Texas has one of the higher effective property tax rates: 1.40% of value a year (2024), ranked 7th among the states.
Taxes are part of the DSCR payment, so they weigh more on the ratio here than in most states.
On a $302,832 rental, 1.4% is about $4,240 a year, or $353 a month added to the payment the rent has to cover.
The actual bill depends on the county and city. Use the property's real tax figure when you run the numbers.
What Texas investors should know
Cash-out on a rental is not the homestead rule
Texas Section 50(a)(6) and its strict cash-out limits apply to the borrower's homestead. Investment properties follow standard cash-out refinance rules.
If the Texas property is the only one you own, confirm early that it will not be treated as your homestead.
Source: Texas A&M Real Estate Research CenterWind and hail coverage on the coast
In the 14 coastal counties and part of Harris County, standard policies often exclude wind and hail.
The Texas Windstorm Insurance Association (TWIA) is the insurer of last resort. Budget a separate windstorm policy into the DSCR.
Source: Texas Department of InsuranceShort-term rentals are local
Texas has no statewide short-term rental rule, so cities set their own.
Austin, for example, requires a license for each rental under an ordinance amended in 2025. Platforms must show license numbers from July 1, 2026.
Source: City of AustinForeclosure is non-judicial
Most Texas foreclosures do not go through court: the lender sends a 20-day notice to cure, then a 21-day notice of sale.
Faster foreclosure lowers lender risk, which helps investor loan pricing.
Source: Texas Property Code 51.002Texas DSCR loan rates
Rates from 6.172%*, the same as nationwide. Rates move with the market, so the reliable number is a priced quote on your property.
Your DSCR, credit score, LTV, prepayment penalty and loan size move the rate most. In Texas, the property tax bill above feeds straight into the DSCR.
This week's DSCR loan rates* This may be for the strongest files, sometimes with a buydown. Subject to underwriting. Terms as of November 2026.
Texas DSCR loan requirements
- A Texas rental, long-term or short-term, not a home you live in
- DSCR of 0.75 or higher, 0.8 or higher for the best pricing
- Up to 85% LTV on a purchase for U.S. residents, 70% for foreign nationals
- Rent from the current lease, or the appraiser's market rent
- No tax returns, W-2s or pay stubs
- Close in your name or an LLC
Loans for Texas investors
- DSCR rental loans: up to 85% LTV purchase, 70% cash-out, 30-year fixed or interest-only
- Fix and flip (hard-money): up to 90% of purchase and 100% of rehab, capped at 75% of ARV
- Bridge loans: up to 70% LTV, 7-14 days to close
- Foreign nationals: every program, no SSN or U.S. credit, close in a U.S. LLC
Texas DSCR loan questions
What are DSCR loan requirements in Texas?
The same as nationwide. Best pricing at a DSCR of 0.8 or higher. Minimum 0.75 with a pricing adjustment.
Up to 85% LTV on a purchase for U.S. residents. Credit and reserves are priced in. No tax returns.
Do high Texas property taxes hurt my DSCR?
They lower it: taxes are part of the payment the rent must cover. Use the actual tax bill or the county rate in the DSCR calculator, not a national average.
Can I do a cash-out refinance on a Texas rental?
Yes. The homestead cash-out limits do not apply to investment property. A DSCR cash-out refinance goes up to 70% LTV.
Are fix-and-flip loans available in Texas?
Yes, statewide, including Houston, Dallas-Fort Worth, San Antonio and Austin.
Sources
General information, not legal or tax advice. Loan terms are subject to underwriting.