DSCR Loans: How Investors Are Bypassing W-2 Underwriting

DSCR (Debt Service Coverage Ratio) loans qualify based on the property's rental income covering the mortgage payment — usually requiring DSCR ≥ 1.2x. No tax returns, no W-2s, no employment verification.

Rates run 50–150bps above conventional, with 20–25% down. The trade-off is access: investors with limited W-2 income or many existing properties can still scale.

DSCR is the fastest-growing investor loan product. Understand the prepayment penalties — most carry 3–5 year structures.