DSCR Loan vs Conventional Investment Property Loan
Which loan is better for your rental property investment?
Zack Cervantes · NMLS #502342 · New American Funding
A DSCR loan qualifies real estate investors based on the property's rental income rather than personal income, making it ideal for scaling a portfolio without DTI constraints. A conventional investment property loan requires full income documentation but may offer lower rates. Zack Cervantes (NMLS #502342) at New American Funding helps investors choose the right loan structure for every deal in 48 states.
Side-by-Side Comparison
| Feature | DSCR Loan | Conventional |
|---|---|---|
| Income Docs | None required | W-2s, tax returns, pay stubs |
| Qualification | Property cash flow (DSCR ratio) | Personal DTI ratio |
| Down Payment | 20-25% | 15-25% |
| Property Limit | Unlimited | Up to 10 |
| Rates | Higher (0.5-1.5% premium) | Lower |
| Short-Term Rentals | Usually allowed | Typically not |
| Closing Speed | 15-21 days | 30-45 days |
When to Choose DSCR
- ✓You're self-employed and your tax returns don't reflect your real income
- ✓You already own 5+ financed properties and are hitting conventional limits
- ✓You want to close fast without the documentation burden
- ✓You're investing in Airbnb or short-term rentals
- ✓You want to scale your portfolio without personal DTI constraints
See What You Qualify For
Free · No credit pull · About 60 seconds
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