Frequently Asked Questions
Have more questions?
Learn moreDSCR stands for debt service coverage ratio.
The DSCR is calculated by dividing the Net Operating Income / Debt Service where:
- Net Operating Income = Adj. EBITDA = (Gross Operating Revenue) − (Operating Expenses)
- Debt Service = (Principal Repayment) + (Interest Payments) + (Lease Payments)
Net Operating Income (NOI) is the property’s gross operating income minus its operating expenses.
NOI = Gross Operating Income − Operating Expenses
This typically includes rental income minus costs like property management, maintenance, taxes, insurance, and HOA fees. It does not include mortgage payments, depreciation, or capital expenditures.
Most lenders prefer a DSCR of 1.25 or higher, as it indicates stronger cash flow. However, some lenders—including Figure—may accept DSCRs as low as 1.0 depending on other factors like credit score and property type.
You can improve your DSCR by increasing rental income, reducing operating expenses, or refinancing to lower your existing debt payments. Minimizing vacancies and paying down high-interest debt can also boost your ratio.
A DSCR loan is designed for real estate investors, letting you borrow against your homes using rental income instead of employment income. It’s ideal for investors looking to scale their portfolio without traditional income verification.
The DSCR Loan from Figure is a refinance loan that allows real estate investors to borrow against their homes using their rental income instead of their employment income. While many lenders have offered this type of product in the past, there hasn’t been a standardized process, leaving investors and loan officers frustrated. Figure’s process is easy! You can get approval in 5 minutes3navigates to numbered disclaimer, and for loans under $400k, funding in as few as five days2navigates to numbered disclaimer. Except for the notary process, the entire thing can be completed online.
There’s no set limit on the number of DSCR loans you can have with Figure, as long as each property qualifies individually and you meet the lender’s credit and portfolio guidelines. This makes DSCR loans ideal for scaling your real estate investment portfolio.
When you check your rates3navigates to numbered disclaimer with Figure, only a soft credit pull is performed—this won’t affect your credit score. However, if you submit a full application, Figure will conduct a hard credit pull, which may impact your credit and will appear on your credit report.
No. DSCR loans are long-term mortgage products designed for real estate investors. Unlike hard money loans, they typically offer lower interest rates, longer terms, and more stable financing.
No. DSCR loans are considered non-QM (non-qualified mortgage) loans. They don’t follow Fannie Mae or Freddie Mac guidelines and are underwritten based on property cash flow, not personal income.
Yes, you can apply if your property is held by an LLC, as long as you are the majority owner.
- Single-family residences (SFRs)
- 2-4 unit residential properties
- Condos and townhomes
- Multifamily properties within lending limits
Figure offers DSCR loans to real estate investors, self-employed individuals, LLCs, and corporations.
To qualify for a DSCR loan with Figure, you’ll need to meet the following criteria:
- FICO Score: 680 or higher
- DSCR (Debt Service Coverage Ratio): Greater than 1.0
- Maximum CLTV (Combined Loan-to-Value): Up to 80% for purchases and rate-and-term refinances and up to 75% for cash-out refinances
- Eligible Property Types: Single-family residences and 2–4 unit rental properties
No. DSCR loans are intended exclusively for investment properties. They cannot be used to finance primary residences or second homes.
No. DSCR loans are designed exclusively for non-owner-occupied investment properties. They cannot be used to purchase or refinance a primary residence or second home.
No. One of the key benefits of a DSCR loan is that it qualifies based on property cash flow, so tax returns, W-2s, or pay stubs are not required.
No. Figure’s DSCR loans do not require tax returns or traditional income documentation. The loan is qualified based on the property’s rental income.
Apply online with our 100% online application with no W-2s or tax returns required. Prequalification is based on rental income and won’t affect your credit. Get approval in minutes and if approved, you can get up to $400K funded in as few as 5 days (even complex deals close in under 9 days)2navigates to numbered disclaimer—so you can grow your rental portfolio quickly and hassle-free.
- Current lease agreement
- Valid ID
- Homeowners Insurance Policy
- HOA statement
- If the property’s title is held in an LLC, Operating Agreement, Articles of Organization, Certificate of Good Standing, Resolution
Figure will help coordinate an in-person closing and notary session at a location of your choice. (It could be at your home or office or wherever is convenient for you!)
Figure does not require an appraisal for loan amounts below $400,0001navigates to numbered disclaimer.
Up to 80% of your CLTV (75% for cash-out refi).
Figure offers loan amounts from $75,000 - $1,000,0005navigates to numbered disclaimer. No appraisal is needed for loan amounts below $400,0001navigates to numbered disclaimer.
A property valuation fee may be required and is paid outside of closing.
For loan amounts below $400,000, Figure averages 5-day funding2navigates to numbered disclaimer. For larger loan amounts, an appraisal1navigates to numbered disclaimer is required so it can take a few days longer.
Figure offers competitive, fixed interest rates that help keep your monthly payments predictable.
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Notices, complaints and inquiries
Qualified Written Requests, Notifications of Error, or Requests for Information concerning your loan must be provided in writing and directed to this PO Box address in order to be treated as such.
P.O. Box 40534 Reno, NV 89504