DSCR loans in North Carolina and South Carolina

A DSCR loan is an investment property mortgage that qualifies the loan on the property's rental income instead of your personal income. DSCR stands for debt service coverage ratio. The lender divides the property's monthly rent by its full monthly housing payment (principal, interest, taxes, insurance and any association dues, often called PITIA). Because the property's rent is what is underwritten, no program asks for tax returns, W-2s or pay stubs.

Yes. Across our lender network, select programs accept first-time investors with no prior rental history. These files are commonly capped at about 80% LTV, usually want a credit score starting around 680, a DSCR of 1.0 or higher and extra reserves. Some programs ask that you have owned a home for 12 months, and a limited number of programs consider applicants who have never owned a home. There are no tax returns, W-2s or pay stubs. See first-time investor DSCR loans. Not a commitment to lend.

A DSCR of 1.0 or higher, meaning the rent covers the full payment, is the common benchmark and gets the widest choice of programs. Across our lender network, select programs accept ratios as low as 0.75, and a few offer no-ratio options where the rent does not have to cover the payment at all. Those lower-ratio programs usually ask for a larger down payment, more reserves or higher pricing. What is allowed depends on the program, so treat any number as general guidance and not a promise. See DSCR loans below 1.0 and no-ratio loans.

No. There are no tax returns, W-2s, pay stubs or income verification on any DSCR program we offer. Personal income is not part of the underwriting, so there is no debt-to-income calculation and no employment verification. You will still provide a credit report, proof of funds for the down payment and reserves, identification, and rental documentation such as a lease or an appraiser's rent schedule. If the borrower is an LLC, entity documents are also needed.

Across our lender network, a DSCR purchase commonly needs 20% to 25% down. Select programs go up to 85% loan-to-value on purchases for strong files, which means 15% down. First-time investors are commonly limited to about 80% LTV (20% down). Short-term rentals, condos, 5 to 8 unit properties, lower credit scores, foreign nationals and ratios below 1.0 can each push the required down payment higher. Cash-out refinances usually allow less leverage than purchases. Your file is matched to the program that fits.

It depends on the program and the purpose. Purchases commonly go to 75% or 80% LTV, and select programs go to 85% for strong credit and a DSCR of 1.0 or higher. Cash-out refinances are usually lower, often 65% to 75%, and up to 80% on select programs. First-time investors are commonly capped near 80%, ratios below 1.0 near 70% to 75%, foreign nationals near 70% to 75% and 5 to 8 unit properties near 75% on a purchase.

Yes, on many programs. Closing in an LLC is common for investors and is one of the main reasons people move from conventional financing to DSCR. The lender will usually want the entity documents and a personal guarantee from the owners. Select programs also accept corporations or trusts. See DSCR loans for LLCs. Ask a North Carolina or South Carolina attorney or CPA how to structure ownership, because we do not give legal or tax advice.

Rates depend on the scenario, so we do not publish a single number. DSCR pricing is driven by credit score, LTV, DSCR, loan amount, property type, occupancy, prepayment penalty choice and the lender. Because the loans are investor loans, pricing is generally higher than a conventional owner-occupied loan. Ask for a scenario quote and compare the full cost, not only the rate. Read our rates and costs guide.