No-Ratio DSCR loans
What is a no-ratio DSCR loan?
A no-ratio DSCR loan has no minimum rent-to-payment requirement, so a property whose rent falls short of PITIA — or is vacant — may still qualify. Lenders offset the risk with lower leverage, higher credit scores and more reserves.
- A No-Ratio DSCR loan qualifies the property without requiring rent to fully cover PITIA — no DSCR minimum is applied.
- The trade-off is leverage and pricing: expect lower maximum LTV (roughly 70–75%) and a higher rate than standard DSCR.
- It fits appreciation plays, low-yield metros, vacant or between-tenant properties, and heavy value-add deals.
- Credit, reserves, and property quality carry more weight when the ratio is not there to support the file.
- All parameters are illustrative program guidelines, not an approval, quote, or commitment to lend.
The trade is straightforward: the lender gives up the coverage test and you give up leverage. Where a standard DSCR loan might reach 80% LTV, No-Ratio generally tops out at 70–75% with more months of reserves verified at closing.
When No-Ratio is the right structure
No lease and a market rent that lands under PITIA — common in mid-turnover acquisitions.
High-price metros where yields are thin but the long-term thesis is equity growth.
No T-12 revenue history yet and projections alone won't carry the ratio.
High tax and insurance markets where PITIA outruns achievable rent.
Get your DSCR Scenario Summary
Complete the short pre-qualification form and we send back a full DSCR analysis: HUD Fair Market Rent, AVM value, calculated DSCR, PITIA breakdown, and the max qualifying loan amount up to 80% LTV.
- HUD FMR rent estimate for the subject property
- AVM property value + max qualifying loan
- Calculated DSCR with PITIA breakdown
- Cash-on-cash and year-one cash flow
Illustration only, generated from the information you enter. Not a loan estimate, pre-qualification, commitment to lend, or approval. Formal pricing, LTV, and terms are issued only after credit review, income/asset documentation, and full underwriting.
Current No-Ratio DSCR Rates
No-ratio structures qualify without a coverage-ratio test, and they are separate programs from standard DSCR with their own eligibility and pricing. The live quotes below are standard DSCR pricing at a qualifying ratio, shown so you can see the structure of a real quote — they are not no-ratio pricing and a no-ratio scenario may price differently.
Because a no-ratio file cannot be priced from the public scenario inputs alone, the accurate way to see your number is a scenario submission where credit, leverage and reserves are known. We do not publish an estimated no-ratio rate, because we would be inventing it.
Live pricing unavailable — no current pricing response.
Get My Live DSCR Rates
The cards above are featured examples from the current snapshot. Enter your own property, credit tier, leverage and rent to see every eligible option for your deal.
Rate & Pricing Disclosure: This quote is an indication for the scenario entered and the pricing available at the time shown. Rates and terms are subject to change without notice and may change or may not be available at commitment or closing. This is not a rate lock, loan approval, commitment to lend or offer of credit. APR reflects applicable borrower-paid finance charges and pricing credits for this quote and may be the APR returned with the quote or our own audited calculation where verified borrower-paid finance charges outside the quoted price apply. Additional lender and third-party costs may apply and may not be included in the APR. Payment shown is principal and interest only and excludes taxes, insurance, HOA dues and other applicable costs, so your actual payment will be higher. Simply Approved Mortgages LLC is a mortgage broker, not the funding lender. Business-purpose, non-owner-occupied investment property only. Equal Housing Opportunity.
APR reflects applicable borrower-paid finance charges and pricing credits for this quote. Depending on the option, the APR shown is either the APR returned with that quote or our own audited calculation, used where verified borrower-paid finance charges outside the quoted price apply. Other lender and third-party costs may apply and may not be included in the APR.
Estimated payment is principal and interest only and does not include property taxes, insurance, HOA dues, flood insurance, escrows or other applicable costs.
Rate questions for this page
How much more does a no-ratio DSCR loan cost?
The premium varies by lender, leverage and credit tier, so we do not publish a fixed spread. A loan officer can return the actual difference for your file in writing.
Why can't the rate center price a no-ratio scenario?
The public rate center prices scenarios that carry a qualifying coverage ratio. No-ratio programs are quoted per file against reserves, credit and property profile.
Compare loan officer compensation on your investor loan quote
Loan officer compensation is part of the cost of a mortgage. Simply Approved Mortgages' lender-paid compensation is 1.5% of the loan amount. Enter the compensation shown on another lender's quote to see the difference in dollars.
Compensation difference on this illustration: $3,750.
How lower compensation can help you
When less compensation is built into pricing, there can be room for a lower interest rate, which may lower your monthly payment.
Depending on the rate you choose, pricing can sometimes include a lender credit toward third-party closing costs.
A lower payment can improve your property's debt service coverage ratio (DSCR) and monthly cash flow.
As a mortgage broker we compare pricing from wholesale lenders instead of offering a single bank's retail pricing.
Illustration only, not an offer of credit or a Loan Estimate. Simply Approved Mortgages is a mortgage broker (NMLS #2620881), not a direct lender. Lender-paid compensation is paid by the wholesale lender, not directly by you, and a lower compensation figure does not by itself guarantee a lower rate or lower closing costs. Actual rate, fees and credits depend on credit, property, loan program and market conditions. Business-purpose investor loans in eligible states; consumer residential lending in FL and CO only.
Standard DSCR vs. No-Ratio
| Factor | Standard DSCR | No-Ratio DSCR |
|---|---|---|
| Coverage test | 1.00+ for full leverage | Waived or 0.75 nominal floor |
| Max LTV | Up to 80% | 70–75% |
| Min FICO | 660 | 680 |
| Reserves | 1–6 months PITIA | 6+ months typical |
| Relative pricing | Baseline | Premium |
No-Ratio: benefits and trade-offs
- Deals that fail the ratio test can still close
- No lease or rent history required
- Still no tax returns, W-2s, or DTI calculation
- Clean refinance path into standard DSCR once leased
- Lower maximum leverage — more cash at closing
- Rate premium over a standard DSCR loan
- Higher credit floor and heavier reserve requirement
- Negative carry has to be funded from outside the property
Deal doesn't cash-flow yet?
Send the numbers anyway. We'll show you the No-Ratio structure alongside the standard DSCR option so you can compare cash to close.
DSCR loan programs
Every DSCR variant we arrange, with the leverage and credit floor that applies to each.
Buy a 1–8 unit rental qualified on market rent or the in-place lease — up to 80% LTV, no tax returns.
Pull equity out of a rental you already own to fund the next purchase. Up to 75% LTV on the strongest tier.
Replace hard money, a maturing bridge, or a higher-rate note with 30-year fixed rental financing.
A revolving line against rental equity — draw only what you need. 700 min FICO, up to 75% CLTV.
A second-position line behind your existing first mortgage on a rental — priced on combined loan-to-value.
The formula, the rent figure lenders use, and every step from scenario review to closing.
Credit, DSCR floor, down payment, reserves, property type, and entity rules laid out in one place.
A 10-year interest-only period lowers PITIA, lifts your ratio, and frees monthly cash flow.
The honest ledger — what you gain over conventional financing and exactly what it costs.
Current rate bands by DSCR, LTV, and FICO tier — plus what actually moves your pricing.
Run rent ÷ PITIA in seconds and see which pricing tier your deal lands in.
No-ratio DSCR loan vs. other investor financing
General differences; exact limits vary by lender.
| Feature | No-ratio DSCR | Standard DSCR |
|---|---|---|
| Minimum DSCR | None | Commonly 1.00x |
| Leverage | Lower | Higher |
| Reserves | Larger | Standard |
| Pricing | Higher | Lower |
No-ratio DSCR loan document checklist
Here's what to have ready when you apply. Missing items can be added during processing — but a complete file closes faster.
- Entity documents (Articles of Organization, operating agreement, EIN letter)
- Two most recent months of bank statements showing down payment and reserves
- Appraisal with rent schedule (Form 1007) — ordered during processing
- Signed lease or market-rent support for each unit
- Landlord insurance quote naming the lender as mortgagee
No-Ratio DSCR questions
What is a No-Ratio DSCR loan?
A rental-property loan that skips the debt-service coverage test. Instead of proving rent covers PITIA, you offset the risk with a larger down payment, a stronger credit profile, and more reserves.
Who is it for?
Investors buying in appreciation markets where rents do not cover payments, properties that are vacant or mid-turnover, short-term rentals with no operating history, and second-home-style assets being converted to rentals.
What are the requirements?
Generally 680+ FICO, 25–30% down (70–75% maximum LTV), and elevated reserves. Some programs still show a nominal 0.75 floor rather than removing the ratio entirely.
How much more does it cost?
Expect a rate premium relative to a standard DSCR loan at the same leverage, because the property is not demonstrating coverage. The exact add-on depends on FICO, LTV, and property type.
Can I refinance out of it later?
Yes. Once the property is leased and the ratio clears 1.00, a rate-and-term refinance into a standard DSCR loan is the common exit.
Can I use a No-Ratio DSCR loan for a first purchase in a new market?
Yes, it's a common use case when you're buying in an appreciation-focused market where rents don't yet support the payment. The larger down payment and stronger credit profile offset the missing coverage test.
Does a No-Ratio loan still require an appraisal with rent estimate?
Yes, an appraisal is still ordered and typically includes a rent schedule for file documentation and future refinance planning, even though the ratio itself is not used to qualify the loan.
Is a No-Ratio DSCR loan the same as a stated-income loan?
No. Stated income references personal income representations, while No-Ratio skips the property coverage test entirely and relies on credit, down payment, and reserves — no personal income figure is used in either case.
Can I get a No-Ratio loan on a 2–4 unit property?
Yes on most programs, subject to the same reduced leverage and elevated reserve requirements that apply to single-family No-Ratio loans, plus any additional adjustment typical of multi-unit properties.
What reserves are required on a No-Ratio DSCR loan?
Reserve requirements run higher than a standard DSCR loan given the absence of a qualifying coverage ratio — commonly 6 months or more of PITIA in a verified account, scaled by loan size and leverage.
Can a No-Ratio loan be used for a vacant fix-and-hold property?
Yes, it's a frequent fit for a property that is vacant, mid-renovation, or between tenants, since there is no lease or stabilized rent yet to test against a coverage ratio.
Is a No-Ratio DSCR loan available on a cash-out refinance?
Yes on select programs, though cash-out leverage under a No-Ratio structure is generally lower than a No-Ratio purchase, given the added risk of pulling equity from a property that isn't demonstrating rent coverage.
Business-purpose loans only. Guidelines shown are illustrative and vary by lender, property, and state. Not a quote, offer, or commitment to lend. Subject to underwriting and approval.
Related programs & tools
The main program: qualify on the property's rent instead of your tax returns.
Underwrite nightly-rate revenue from trailing 12-month actuals or market projections.
Voucher-backed rent with the HAP portion treated as the conservative qualifying income.
Short-term, asset-based financing when you need to close before a refinance or sale.
Purchase plus rehab draws on a 12-month interest-only term for value-add projects.
Current rate bands across every business-purpose program we place.
What Can Change the Outcome
No-ratio and sub-1.00 structures exist for properties where day-one rent will not cover PITIA: high-value markets, vacant units, and heavy value-add. You trade leverage and rate for skipping the coverage test, so expect a lower LTV cap and larger reserve requirement.
Treat it as a bridge to stabilization. Have the rent increase, the renovation, or the refinance into standard coverage planned before you close, not after.
Because availability and pricing vary by program, ask what the specific reserve and leverage requirements are for your scenario rather than assuming the published DSCR terms apply.
Reviewed by Simply Approved Mortgages · NMLS #2620881. Business-purpose investor lending only.
Get a No-Ratio scenario side by side
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Pick the loan type that fits your deal and complete a short, tailored pre-qualification. A licensed loan officer follows up with an initial scenario review once we have your credit authorization and supporting documents — usually the same business day. Formal pricing and terms follow underwriting.
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