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LONE STAR FINANCING

DSCR Loan Guidelines

Requirements & Program Eligibility in Texas
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Understanding DSCR Loan Guidelines for Investors

The Texas DSCR lending landscape includes dozens of programs, each with its own guidelines and terms. At Lone Star Financing, we evaluate top national DSCR options and align you with the best fit based on your:

  • Property type
  • DSCR ratio
  • Credit score
  • Loan amount
  • Long-term or short-term rental
  • LLC or personal title
  • Cash-out or purchase scenario


The information below outlines general DSCR loan requirements and eligibility, providing a snapshot of typical program ranges and underwriting guidelines.

DSCR Loan Guidelines

  • Loan amounts up to $3,000,000
  • Cash-out options up to $1,000,000
  • No tax returns, W-2s, or pay stubs required
  • Qualification based on rental income
  • Ideal for real estate investors
  • LLC and entity ownership allowed
DSCR Calculator DSCR Requirements

DSCR Loan Eligibility Guidelines

Exact DSCR lender guidelines vary — we shop them for you and select the best match.

Credit Score Requirements

Program Type
Minimum FICO
Best Pricing FICO
Standard DSCR
620–660+
700+
STR/Airbnb DSCR
640–660+
700+
Low DSCR (<1.0)
660+
700+
Multi-Family (2–8 units)
660+
700+

DSCR Ratio Requirements

Scenario
Typical Minimum DSCR
Notes
Strong cash flow
1.20+
Best pricing & smoothest approval
Standard approval
1.00–1.19
Most common range
Limited cash flow
0.75–0.99
Higher rates / lower LTV
Break-even (0.00–0.74)
Case-by-case
Few lenders offer; higher reserves

Maximum LTV & Loan Amount Guidelines

Maximum Loan-to-Value (LTV) Limits

Transaction Type
Typical Max LTV
Purchase
Up to 80%
Rate & Term Refinance
Up to 75–80%
Cash-Out Refinance
Generally capped at 75%
Low DSCR Properties (< 1.00)
Typically 65–70%
Condos / Non-Warrantable
Usually 65–75%

DSCR Loan Amount Limits

Program Type
Loan Size Range
Standard DSCR Loans
$75,000 – $3,000,000
High-Balance DSCR
Up to $5,000,000
Portfolio DSCR Loans
No fixed cap (cross-collateralization available)
Small Multifamily (2–8 Units)
Up to $3–8M depending on unit count

Eligible DSCR Property Types

Property Type
Eligibility
Single-Family (1 unit)
Eligible
Condo / Townhome
Eligible
Non-Warrantable Condo
Often eligible (case-by-case)
2–4 Unit (Duplex / Triplex / Fourplex)
Eligible
Small Multifamily (5–8 units)
Available (select lenders)
Condotel
Possible (case-by-case)
Short-Term Rental (STR) / New Construction
Possible (lender dependent)
Manufactured / Mobile Home
Limited (case-by-case)

Note: DSCR eligibility can vary by lender, occupancy type, and market—Lone Star Financing will match your property to the right program.

Reserve Requirements

Loan Profile
Typical Reserves
Strong DSCR + Higher FICO
3–6 months
Standard DSCR
6 months
DSCR < 1.0 or Short-Term Rental (STR)
9–12 months
Portfolio Loans
12+ months

Prepayment Penalty Options

Prepay Structure
Available?
Notes
5-Year Standard
Yes
Often lowest pricing
3-Year Stepdown
Yes
Most common option
1-Year
Yes
More flexibility; may price higher
No Prepay
Yes
Highest rate (less common)

Reserve and prepay terms vary by lender and property type—Lone Star Financing can help you choose the best mix of rate and flexibility.

Income Documentation Accepted

Income Type
Accepted
Notes
Long-term lease
Accepted
Most common
Market rent (Form 1007)
Accepted
Often used for LTR
Actual Airbnb / VRBO income
Accepted
Uses STR income history
Projected short-term rental income
Accepted
Appraisal-based or AirDNA (lender-dependent)
Personal income documents (W-2s / pay stubs / tax returns)
Not required
Not needed for DSCR qualification

Documentation options vary by lender and property type—Lone Star Financing will confirm the best documentation path for your scenario.

This DSCR Loan Guidelines overview outlines current underwriting standards from leading DSCR lenders nationwide. At Lone Star Financing, we use this guide to help Texas investors compare LTV limits, minimum credit scores, reserve requirements, DSCR ratios, short-term rental eligibility, and more—based on lender, property type, and borrower profile.