Is It Hard To Get A DSCR Loan?

Aerial view of a dense residential neighborhood with many homes, representing a market of potential investment properties for DSCR loans.

If you’re a real estate investor in Colorado exploring financing options, you’ve probably heard of DSCR loans. They’ve become one of the most popular tools for building rental portfolios and one of the most common questions I get is:

“Is it hard to get a DSCR loan?”

Let’s break it down.

What Makes a DSCR Loan Different?

A DSCR loan, short for Debt Service Coverage Ratio, doesn’t rely on your personal income, tax returns, or employment history. Instead, lenders look at the income the property itself produces to determine if the deal makes sense.

This is especially helpful for:

Self-employed investors
Buyers with multiple properties
Anyone whose tax returns don’t reflect their true income

So, Is It Hard to Qualify?

In most cases, no, it’s actually easier than qualifying for a conventional mortgage, as long as the property cash flows.

Here’s what lenders typically want to see:

DSCR of 1.0 or higher, meaning the property earns enough to cover the mortgage
Credit score of 620+
Down payment of 20–25%
Decent property condition and rental market stability

You don’t need W-2s, pay stubs, or tax returns. No debt-to-income ratio calculations. You just need a property that pencils out.

What Could Make It More Difficult?

While the process is streamlined, there are a few things that can complicate approval:

Low appraisal or insufficient rental income
Property is vacant or needs rehab
DSCR is below 1.0 (you might still qualify, but rates may be higher)

That’s why it’s important to run the numbers upfront and work with a lender who knows DSCR inside and out.

Final Thoughts: A Smart Tool for Colorado Investors

For investors in Denver, Centennial, Castle Rock, and across Colorado, DSCR loans offer flexibility that traditional mortgages can’t. They’re designed to make qualifying easier as long as the investment makes sense on paper.

Here is a helpful in depth guide to DSCR Loans

Want to see if a DSCR loan works for your next deal? I’d be happy to help you review the numbers and see what’s possible.

Call me at 303-670-0137 or contact me here.