What is a DSCR loan?
A DSCR loan is a business-purpose, non-owner-occupied investor loan that desks the property’s rental income against the payment the asset has to carry — not the borrower’s W-2 or tax-return DTI.
DSCR means debt service coverage ratio. On this desk it is how most investor files get mapped. The borrower story still matters for identity, reserves, and experience. The coverage ratio is about the property.
That is a different conversation than a conventional or bank-statement file. We broker the file. We do not fund it. Nothing on this page is a commitment to lend.
How is lender DSCR calculated?
Lender DSCR is Gross Monthly Rent ÷ Monthly PITIA (or ITIA if IO). That is the qualification number on the calculator. Investor cash flow is a separate, labeled view and is never mixed into lender DSCR.
If monthly PITIA (or ITIA) is zero or not yet entered, there is no ratio to show. The worksheet will not invent a coverage number.
Working definition
Lender DSCR = Gross Monthly Rent ÷ Monthly PITIA (or ITIA if IO)
The live calculator on /calculator uses this formula. Investor cash flow is a separate, labeled view.
What is PITIA, and when is it ITIA?
PITIA is principal + interest + monthly taxes + monthly insurance + monthly HOA. That is the default amortizing debt service the asset has to cover.
ITIA is the interest-only version: interest + taxes + insurance + HOA, with no principal. If the worksheet is on interest-only, the label is ITIA — never PITIA. The ratio is still rent divided by that monthly total.
How is investor cash flow different from lender DSCR?
Investor cash flow is rent minus PITIA/ITIA minus optional vacancy, maintenance, and property-management percentages. It is display-only. It does not change lender DSCR.
Operators run both numbers. Capital sources that use DSCR are looking at the coverage ratio, not your personal pro forma. Keep the labels honest on the worksheet.
What counts as rental income on a DSCR file?
Programs differ on what counts: in-place leases, market-rent support, or a haircut on short-term actuals. The calculator uses the monthly rent you enter. It does not scrape a channel or invent a rent to make coverage work.
Short-term and mid-term product is still an asset file when occupancy is investment. See short-term rentals for how that income is usually packaged. Typical requirements covers occupancy, entity, and property type at a high level.
Who is a DSCR loan for?
Operators buying or refinancing non-owner-occupied residential investment property who need the asset — not a consumer DTI story — to carry the file.
It is not for a primary residence. It is not a retail refinance product. If a conventional path is cleaner, we will say so on the 30-minute call rather than force a DSCR structure onto a deal that does not need it.
Is a DSCR ratio a credit decision?
No. Bands on the worksheet are guidance only: Strong ≥ 1.25, Acceptable 1.00–1.24, Weak < 1.00. They are not a lock, a quote, or an approval from this desk or from a capital source.
If you want a file mapped, bring the address, the rent, and the hold plan to a 30-minute call.