DSCR Loan
For Rental Property Investors
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.
680
Min Fico
(Up to 75% LTV)
85%
Max LTV
(Minimum 720 FICO)
Loans up to
$3 million
with a minimum of $100,000
Up to
6%
seller concessions
Interest-only available;
gift funds okay
5/6 ARM, 7/6 ARM, & 30 year
options available
- Purchase, Refi Cash Out, Refi Rate & Term, & Delayed Financing
- 1007 Waiver - Automated rental AVM report available (75% Max LTV, 1 unit only)
- AirDNA Analysis - Automated short term rental report
- 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
- Warrantable, non-warrantable, and condo hotels allowed
- Loan Features: Adjustable-Rate Mortgage (ARM), AirDnA, Automated Rental Income AVM, Rental AVM, Appraisal Waiver
- Please contact an Angel Oak Account Executive for complete qualification
We currently offer business-purpose loans for investment properties through approved clients, even if they’re not licensed in the subject property’s state.
Unlicensed states: AL, AR, CA*, CO, CT, FL, GA, IN, LA, MA, MO, MT, NC, NM, OH, OK, PA, SC, TN, TX*, UT, WA, WI
*California (CA): The originator’s company, and the originator’s branch must hold active CA licenses. The originator is not required to hold an individual license.
*Texas (TX): HELOC transactions are not eligible.
FAQ's
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.
DSCR Loan Calculator
Angel Oak’s DSCR loan calculator offers a streamlined analysis of a property’s cash flow, assisting real estate investors, brokers, and borrowers in assessing the property’s income generating potential.