If you’re looking to finance a 5–10 unit investment property but traditional lending requirements are getting in the way, there may be another option. DSCR financing focuses primarily on the property’s rental income and cash flow rather than your personal income, offering a more streamlined approach for real estate investors.
5-10 UNIT
PROPERTIES
Finance 5 to IO unit
multifamily investment
properties.
CASH FLOW
FOCUSED
Qualify based on
rental income with
DSCR—no tax
returns required.
FLEXIBLE
GUIDELINES
Competitive terms
designed for real
estate investors.
FAST &
EFFICIENT
Quick closings to help
you secure and scale
more properties.
BUILT FOR
INVESTORS
Solutions tailored for
long-term rental
property success.
The 5–10 Unit DSCR financing program gives real estate investors an alternative way to purchase or refinance smaller multifamily buildings by focusing primarily on the property’s rental revenue rather than the borrower’s personal earnings.
Instead of relying on conventional income documentation, extensive tax-return analysis, or personal debt-to-income (DTI) calculations, eligibility is evaluated using the property’s Debt Service Coverage Ratio (DSCR) — a measure of whether rental income can support the property’s required debt payments.
In other words, the investment property’s financial performance plays the central role in qualification.
This financing option can provide investors with a practical path to grow their rental portfolio and acquire larger income-producing properties.
Loan options may exceed $5 million, subject to property value, leverage, and program guidelines.
Traditional debt-to-income calculations are generally not used for qualification.
A 680+ credit score is commonly preferred and may provide access to more favorable financing terms.
Designed for 5–10 unit residential multifamily buildings, established rental properties, and other qualifying long-term rental investments.
Required property cash-flow coverage commonly ranges from 1.10 to 1.25, depending on leverage and other underwriting factors.
Available for investment properties only; owner-occupied properties are not eligible.
Financing may reach 75% LTV, depending on the property, borrower experience, and overall transaction.
Borrowers may need approximately 6–12 months or more in reserves, based on program requirements.
Personal employment or income verification may not be required, as qualification primarily focuses on the investment property’s cash flow.
Previous rental property ownership or landlord experience is generally preferred.
Our licensed loan officers are available to provide guidance and answer your financing questions. A phone application can often be completed in as little as 10 minutes.
Your loan application will be evaluated, followed by the property appraisal and underwriting process. Once all applicable requirements are satisfied, the loan can move forward to approval.
After all required conditions have been completed and the loan is cleared for closing, the final documents will be prepared for signature. Once the documents are signed and closing requirements are met, the loan can proceed to funding.
You do not need to know the exact loan program before getting started. Tell us about your income, property, or financing goals, and our team can help you explore available mortgage options.
Prefer to talk with us? Call (877) 787-7463
At Prime Choice Funding, we recognize that financing a 5–10 unit property requires a different approach than financing a typical single-family rental. Our team evaluates important factors such as:
We work to structure financing around key investment objectives, including:
Because successful multifamily investing isn’t only about financing the property you own today — it’s also about creating opportunities for long-term portfolio growth.
A 5–10 Unit DSCR loan may be a strong financing option for:
Qualification is primarily driven by the property’s ability to generate sufficient rental income to support its debt obligations.
Property cash flow plays a key role in determining available leverage and financing terms.
At Prime Choice Funding, we help borrowers explore a wide range of financing options for purchasing, refinancing, and investing in real estate. Our experienced team works to identify loan solutions that align with each borrower’s unique financial goals and circumstances.
Put our mortgage knowledge and experience to work for you. Contact Prime Choice Funding today to discuss your financing options and request a personalized quote.
DSCR stands for Debt Service Coverage Ratio. It measures the relationship between a property’s qualifying rental income and its applicable monthly housing expense.
A DSCR loan is an investment-property mortgage that generally allows qualified borrowers to use the property’s eligible rental income to help establish qualification instead of relying primarily on personal income documentation.
A simplified calculation divides eligible monthly rental income by the applicable monthly property obligation.
For example, $5,000 of qualifying monthly rent divided by $4,000 of applicable monthly PITIA equals a 1.25 DSCR.
A 1.0 DSCR generally means the qualifying rental income is equal to the applicable monthly property obligation used in the calculation.
A DSCR below 1.0 generally means the qualifying rental income is less than the applicable monthly housing expense used in the calculation.
Certain low-DSCR or no-ratio programs may still be available.
Certain programs may offer no-ratio or other alternative structures. Requirements vary significantly by lender.
Eligible DSCR programs generally do not use personal tax returns to document qualifying income.
Eligible DSCR programs generally do not use W-2 income to establish qualifying personal income.
DSCR programs generally qualify differently from traditional employment-income mortgages. However, documentation and verification requirements vary by lender and program.
Credit requirements vary by lender and program. Prime Choice Funding has access to DSCR options beginning at certain credit-score ranges, subject to complete borrower and property qualification.
Down-payment requirements vary based on credit, DSCR, property type, loan amount, lender and other factors.
Certain programs may allow eligible first-time real estate investors.
Certain DSCR programs permit eligible business-entity vesting, including LLCs, subject to program requirements.
Certain DSCR programs may finance eligible short-term rental properties. Rental-income calculations and requirements vary.
Potentially. Eligible short-term and vacation rental programs may be available.
Yes, eligible 2–4 unit investment properties may qualify depending on program requirements.
Certain lending programs may provide options for eligible 5–8 unit or other multifamily properties.
Yes, eligible DSCR cash-out refinance programs may allow investors to access available property equity.
Certain DSCR programs offer eligible interest-only structures.
Many business-purpose DSCR loans may include a prepayment penalty, subject to program terms and applicable law. Investors should review the specific structure carefully.
DSCR loans are Non-QM/business-purpose investment-property financing and are priced differently from conventional mortgages. The actual rate depends on the loan scenario and market conditions.
Potentially. Investors with stabilized rental properties may be able to refinance eligible short-term or hard-money financing into a DSCR loan, subject to program requirements.
Portfolio and financed-property limitations vary by lender. DSCR programs can be useful for investors who have multiple financed properties, but applicable limits and requirements should be reviewed for each scenario.
No. Certain programs may be available to eligible first-time investors as well as experienced real estate investors.
Neither is automatically better.
Conventional financing may be attractive when a borrower qualifies easily using traditional documentation.
DSCR financing may be attractive when the investor prefers qualification focused primarily on the property’s rental income.
The best option depends on the individual transaction
You do not need to know the exact loan program before getting started. Tell us about your income, property, or financing goals, and our team can help you explore available mortgage options.
Prefer to talk with us? Call (877) 787-7463
