Works for purchases, rate/term refinances, and cash-out refis on 1–4 unit rentals. Shows your DSCR, real-time LTV, and tier — including sub-1 scenarios down to 0.75. No email gate, no signup.
Last reviewed: May 17, 2026 by Tyler Huntington, NMLS #181638. Verify at NMLS Consumer Access.
DSCR = monthly rent ÷ monthly PITIA. Above 1.25 usually gives the strongest loan options. 1.00–1.24 is commonly workable. 0.75–0.99 may still be possible with stronger equity, reserves, or down payment. Below 0.75 usually needs additional structuring.
Where your ratio lands determines your rate, LTV cap, and down payment requirement.
DSCR — Debt Service Coverage Ratio — is the single number that decides whether a rental property qualifies for a DSCR loan. The formula is brutally simple:
PITIA = Principal + Interest + Taxes + Insurance + HOA. If the property's rent covers the full payment, DSCR is 1.0. If it covers more, DSCR is higher. If it covers less, DSCR is sub-1.
DSCR loans are commonly offered in the non-qualified mortgage (non-QM) market. The CFPB explains that non-QM loans may be used when a loan has unique characteristics that make it ineligible to be a qualified mortgage. For rental property investors, DSCR financing focuses on the property's cash flow instead of standard W-2 or tax-return income documentation.
For 2-4 unit rentals, DSCR uses the sum of all unit rents. A duplex with two units at $1,800/month each uses $3,600 in the formula. The calculator above auto-sums when you select multiple units.
Most lender literature acts like 1.00 is a hard floor. It's not. Sub-1 DSCR loans are a real product category that goes down to about 0.75. The trade-off is usually a bigger down payment (25-30% instead of 20%), a slight rate hit (0.25-0.75% above the standard tier), or both. The deal still works — you just need to know the math going in.
Most calculators don't model multi-unit, don't show the tier breakdown, and don't tell you what to actually do at each tier. This one does.
Most lenders want a DSCR of 1.00 or higher for standard pricing. A DSCR of 1.25 or above gets you the best rates and up to 80% LTV. Sub-1 DSCR loans are absolutely possible down to about 0.75, but you'll typically need a larger down payment (25-30%) or accept a rate adjustment. Below 0.75 generally requires either a property change, a rate buydown, or larger equity contribution.
For 2-4 unit rental properties, DSCR uses the SUM of all unit rental income divided by the property's total PITIA (Principal, Interest, Taxes, Insurance, and HOA if applicable). So a duplex with two units renting at $1,800/month each would use $3,600 as the gross rental income in the DSCR formula. Vacant units typically use market rent from the appraisal.
Yes. Sub-1 DSCR loans are a regular product category. The practical floor is around 0.75 for most wholesale lenders. Below 1.0 you'll typically see a pricing hit of 0.25-0.75% in rate plus a possible LTV reduction (down to 70% or 65% instead of 80%). The deal still works — the math just needs a bigger down payment to compensate.
Yes. The denominator in DSCR is PITIA — Principal, Interest, Taxes, Insurance, and HOA fees if applicable. Some lenders also include flood insurance, mortgage insurance (rare on DSCR), and any HOA special assessments. Always run the full PITIA, not just the loan payment, or your DSCR will look better than it actually is.
DSCR rates in 2026 typically run 0.75% to 1.5% above conventional 30-year fixed rates. The exact rate depends on your DSCR ratio, credit score (700+ gets best pricing), property type (SFR vs 2-4 unit vs short-term rental), LTV, and whether it's a purchase, rate-and-term refi, or cash-out. Strong files (1.25+ DSCR, 740+ FICO, 75% LTV) get the most competitive pricing.
Most DSCR lenders cap cash-out refinances at 75% LTV — five points lower than the 80% available on purchases and rate/term refis. With a Strong DSCR (1.25+) and 740+ FICO, you can usually get the full 75%. Sub-1 DSCR cash-out is more restrictive — often capped at 65-70% LTV with a rate adjustment. The calculator above shows your real LTV in real time as you adjust the cash-out amount.
Yes — this is a common play. If you bought the property with a conventional loan (using your personal income to qualify) and the rental income now supports the property on its own, you can refinance into a DSCR loan to eliminate the personal income documentation, free up DTI for future purchases, or pull cash out without a tax-return review. The DSCR has to support the new payment at the new rate.
Sub-1 DSCR. Mixed-use property. Short-term rental income. Tenant just moved out. Whatever it is — text me and I'll run it.