Side-by-Side Comparison
DSCR vs Conventional for Investors
Real estate investors face a choice: qualify on personal income (conventional) or qualify on rental income (DSCR). Each has trade-offs depending on your tax situation and portfolio size.
Feature Comparison
| Feature | DSCR Loan | Conventional Loan |
|---|---|---|
| Min Credit Score | 620+ (below 620: up to 50% LTV) | 620+ |
| Income Documentation | None; rent income only | W-2s, tax returns, pay stubs |
| Qualifying Metric | DSCR = rent / PITIA (1.00 covers; under 1.00 at a lower LTV) | Debt-to-income ≤ 45% |
| Min Down Payment | 20% | 20% (investment) |
| Max Properties Financed | Unlimited | 10 (Fannie/Freddie limit) |
| LLC / Entity Eligible | Yes | No (personal borrower required) |
| Loan Limit | $75,000 to $3,000,000 | The current conforming limit set by FHFA (varies by county) |
| PMI Required | No | If down payment < 20% |
| Short-Term Rental Income | Yes (Airbnb/VRBO) | Limited; requires history |
Min Credit Score
DSCR Loan
620+ (below 620: up to 50% LTV)
Conventional Loan
620+
Income Documentation
DSCR Loan
None; rent income only
Conventional Loan
W-2s, tax returns, pay stubs
Qualifying Metric
DSCR Loan
DSCR = rent / PITIA (1.00 covers; under 1.00 at a lower LTV)
Conventional Loan
Debt-to-income ≤ 45%
Min Down Payment
DSCR Loan
20%
Conventional Loan
20% (investment)
Max Properties Financed
DSCR Loan
Unlimited
Conventional Loan
10 (Fannie/Freddie limit)
LLC / Entity Eligible
DSCR Loan
Yes
Conventional Loan
No (personal borrower required)
Loan Limit
DSCR Loan
$75,000 to $3,000,000
Conventional Loan
The current conforming limit set by FHFA (varies by county)
PMI Required
DSCR Loan
No
Conventional Loan
If down payment < 20%
Short-Term Rental Income
DSCR Loan
Yes (Airbnb/VRBO)
Conventional Loan
Limited; requires history
Which Is Right for You?
Choose DSCR Loan If...
Self-employed investors, large portfolios, LLC buyers, or those with low taxable income who rely on rental cash flow.
Choose Conventional Loan If...
W-2 investors with strong personal income who want conforming pricing on a limited number of properties.
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