DSCR Loan
For Rental Property Investors
- Loans up to $3 million with a minimum of $100,000
- Purchase, Refi Cash Out, Refi Rate & Term, & Delayed Financing
- Rental AVM available - Automated monthly market rent report (1007 Waiver)
- Short-term rentals allowed (AirDNA reports accepted)
- New feature: Instant Rental Income Automated Valuation Model (AVM) at the prequal stage
- DSCR < 1.0 and No DSCR options available
- No income or employment required; qualifications based on property cash flow
- Max of five loans with AOMS; exceptions considered when there are more than five loans
- No limit on total number of financed properties a borrower can own
- First time home buyer (FTHB) not allowed
- Properties can vest title in LLC, S corp, C corp, or revocable trusts
- Permanent and non-permanent residents allowed
- Interest-only available; gift funds okay
- Up to 6% seller concessions
- 5/6 ARM, 7/6 ARM, & 30 year fixed options available
- Warrantable, non-warrantable, and condo hotels allowed
- We currently offer business purpose loans from approved clients who may hold an active license in some states but not the one for the subject property. The states for which this may apply are AL, AR, CO, CT, FL, GA, IN, LA, MA, MO, MT, NC, NM, OH, OK, PA, SC, TN, TX, UT, VA, WA, and WI.
- Business Purpose Disclosure
Min Fico
680
(Up to 75% LTV)
Max LTV
85%
(Minimum 720 FICO)
A DSCR loan, or debt service coverage ratio loan, is a type of mortgage used for purchasing short-term or long-term rental investment properties. With a DSCR loan, borrowers can qualify for a mortgage based on a property’s rental analysis. No personal income or employment information is required to qualify. Debt service coverage ratio or DSCR is a measurement of a property’s expected cash flow to determine ability to repay a mortgage loan. It is calculated by dividing the borrower’s net operating income by their debt obligations, including the debt payment.
NEW – Industry First:
Instant Rental Income Estimates For DSCR Loans
Angel Oak is once again leading the way in Non-QM innovation
Our DSCR loans now feature a rental income automated valuation model (AVM) at the prequal stage, giving you instant, data-backed rental income estimates upfront. No more guessing or waiting on the 1007 — you’ll know your rental income number from the start, making it easier to move forward with confidence and close faster. This industry-first technology, available only at Angel Oak, delivers unmatched speed and certainty for originators and borrowers alike.
Read the Full Announcement Here
→ Ready to start opening more doors? Reach out to your AE today
DSCR Loan Calculator
FAQ's
Example Rent Divided PITIA (RDP)
$1100 Rent / $1000 PITIA = 1.10% DSCR Positive Cash Flow
$1000 Rent / $1000 PITIA = 1.00% DSCR 1 to 1 Break Even
$900 Rent / $1000 PITIA = .90% DSCR Negative Cash Flow
What is the benefit to originators who use non-QM loan products?
Originators who utilize non-QM offer a service that their competition may not offer. They become an expert and go-to for the non-QM borrower. The benefit is increased referrals and business growth despite changes in the market. Continue to increase your volume each year regardless of fluctuating interest rates, tighter Agency guidelines, and a slowing refinance market.