DSCR Loan Florida – Quick Steps to Get the Loan

DSCR Loan Florida is one of the alternative home loans designed for real estate business owners.

You know what?

Florida is one of the best places to live and is also called the sunshine state in America. Yes, Florida is the 3rd most populous state in the USA.

There are two ways to qualify the loans, they are

  1.  By submitting your documents such as job history, tax returns, proof of income to a particular loan provider, if they qualify they will get loan amount.
  1. Second option is you can qualify for a loan with debt service coverage ratio. 

Note: If you want to invest in rental property to supplement your income, these DSCR loans in Florida are one of the options you need to prefer.

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How does a DSCR Loan in Florida work?

How does a DSCR Loan in Florida work?

DSCR loan or Debt Service Coverage Ratio loan is a mortgage loan which will be funded by NOI of rental property.

Investors will evaluate the potential earning of some properties vs Rental which is operating by debt will accrue.

                                    Property Earning > Rental Debt 

If potential earning is greater than rental debt, the potential property will have DSCR ratio 1.0 and more than that.

If the ratio is above 1.0 ratio, the borrowers will be able to pay monthly using rental debt income.

Many Lenders in Florida qualify the loan by verifying some paperwork. Lenders will not see the financial details of the borrowers.

This is so great for borrowers who do not qualify for their property loan based on some documents such as w2 or tax returns.

When it comes to DSCR loans in Florida, they don’t need any other documents to process. This was one of the reasons for financial lenders to like these loans, because this loan allows more individual people to qualify.

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What is a good DSCR?

How does a DSCR Loan in Florida work?

According to Griffin funding,

Lenders will require a DSCR rate of 1.25 to qualify for DSCR loan florida. The good DSCR will give lower down payment, less interest rate.

If you need a debt secure coverage ratio loan you can apply from Griffin Funding. Because this company allows you to have a minimum DSCR 0.75.

How to analyse the property for DSCR Loan in florida?

First, The lenders will be able to know how the potential income comes from property, and How to generate income from potential property.

Here are the steps to analyse the property for DSCR loan,

Step 1 – Analyse the potential Income

Step 2 – Check the vacancy losses

Step 3 – Check NOI

Step 4 – Check Debt Service

Step 5 – Check DSCR

Step 6 – Calculate loan to value ratio

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Analyze the potential Income

Analyse the potential Income

First you need to analyse the monthly rent. Next you need to divide monthly rent into 12 and check the result if they are given good potential income or not.


If your potential annual income is $1200000 means you need to divide into 12,

                              $1200000/12 = $100000 per month

Check the vacancy losses

Next check vacancy losses. To check this you need to subtract 5% and multiple by annual rate.

The resulting income will be your vacancies loss rate per annum.


If your annual rate is $100000 ,

Your Vacancy loss is 5%

So, In $100000, the 5% is,

$5000 is your vacancy expenses

Check NOI (Net Operating Income)

Next you need to check NOI. You need to subtract operating expenses like property tax, insurance, repair services from annual rent. 

By doing this work, you will find rental property net operating income.

Check Debt Services

Next, you have to check Debt services. 

How do you do this?

To check Debt Services you need to multiply the full loan amount by the given interest rate. With the multiplying amount you have to add principal payment too.

By doing this calculation you will get Debt services.


If you have loan amount $100000, Principle amount $10000, Interest rate 12%

$12000 plus Loan amount

$12000 + $100000

Total debt service charges are $112000.

Check DSCR

You need to check DSCR.

How do you check DSCR Ratio?

To calculate DSCR ratio you need to divide NOI into Mortgage payment.

DSCR = NOI/Mortgage payment

NOI – Income – Expenses

Note: To qualify for a mortgage you need to have greater ratio 1 in DSCR.

Calculate long to value ratio (LTV)

Do you know how to calculate the long to value ratio?

You have to divide the loan amount and value of property. This is to check the percentage value by the lender which has lower or higher property value.

Look – Higher LTV means it will always be risky for lenders to provide loans.


LTV = Loan Amount / Value of Property

What are the best Florida Loan Lenders?

best Florida Loan Lenders

There are more lenders available in Florida, but some of the lenders will be able to give DSCR loans in florida.

They are,

  1. Griffin Funding
  2. Angel Oak
  3. Tuss Financial Group
  4. First Florida Financial
  5. Fidelity Home Group

What are the benefits from getting a DSCR Loan in Florida?

There are more benefits available in DSCR Loan florida, they are,

You know what?

Apart from other business people, Real estate investors have more benefits from DSCR loan florida.

DSCR loans have more benefits compared to other traditional loans. Lets see what are the benefits available,

  • To get a DSCR Loan you do not need any income proof or employment history.
  • There is no limit to how many properties you have.
  • You will get Loan with a low down payment. Probably 20%.
  • You will get approved with a maximum $5,000,000.
  • You can also get longer term loans and Shorter term loans.
  • This DSCR Loan help for both new and experienced investors 
  • DSCR Loan is available for Interest only.

If you need more valid information you can contact a Loan specialist today.

Do you know how to calculate DSCR Loan for buying rental property?

Do you know how to calculate DSCR Loan for buying rental property?

To calculate DSCR loan you have 2 important values, they are, NOI & Annual Debt Payment.

NOI means non cash items, annual net income, and any depreciation cost.

Annual Debt includes Interest payment, Repayment of principal amount.

              DSCR = NOI/Annual Debt Payments

What is the minimum DSCR to quality in Florida?

To qualify for DSCR Loan in florida is quite easy. Yes. If you have DSCR in 1.25 then you will easily qualify for loan amount.

Most lenders will be able to approve loans after they know if the borrowers will pay the loan amount or not.

If Lender trust borrowers will pay the loan, he will sanction the loan immediately as per your requirements.

Let see the chart below how the down payment differs from the DSCR ratio.

DSCR RatioDown PaymentLoan Approval
DSCR<140%Will Possible
DSCR=120%Will Possible

What are the basic requirements for getting a DSCR Loan in Florida?

What are the basic requirements for getting a DSCR Loan in Florida?

To get DSCR Loan florida, you need to basic requirements, they are

  • Credit Score
  • Down Payment
  • DSCR Ratio

Credit Score 

To get a DSCR Loan you need to have at least a 620 credit score. Note: If you have a higher down payment with a higher interest rate, lenders will provide a loan for a minimum credit score.

Down Payment

Based on Lenders and your credit scores your down payment will vary. It will be approximately more than 20% to 30%.

DSCR Ratio

If you have a good DSCR ratio you will get a loan immediately, If you have a lesser DSCR ratio you will not get a loan amount. According to lenders you may get a loan amount with a lesser DSCR ratio.

Note : Interest rate of loan will vary depending on lenders.

Steps to get DSCR Loan in Florida

By following the below steps you will get a DSCR loan as quickly as possible.

Step 1 – Check the best Mortgage lender who provides loan in Florida

Step 2 – Prove that your real estate property will have more cash flow to pay for loan amounts for your Lenders.

Step 3 – If you have a down payment between 20% to 25% you will get a DSCR loan.

Step 4 – Once a lender has all information your loan will be sanctioned.

Do you know how DSCR Affects Loan Eligibility?

Yes, DSCR indicates that, If you repay the loan amount to your lenders on the correct time you are eligible for loan amount.

On the other hand, DSCR indicates that if you delay repaying the loan amount to your lender you will not be eligible to apply for the loan.

What DSCR Loan Property Types in Florida 

If you are going to get a DSCR loan, you need to know the property types available in florida.

Some of the properties are,

  • Commercial Property,
  • Multifamily properties,
  • Townhomes,
  • Single family,
  • Short term rentals,
  • Warrantable and Non Warrantable condos.

Real Estate Property can’t be used in DSCR Loan

Here are some properties, DSCR Loan cannot be used,

  • Log Cabins,
  • Dome Homes,
  • Manufactured home,
  • Condotels,
  • Properties less than 700 square feet
  • Rural Properties.

What are the advantages of DSCR Loan Florida?

There are more advantages for real estate property lenders.

  • You will get a loan with minimum down payment.
  • You will get a loan with less paperwork.
  • You will get a loan within a short period of time.
  • You will get a loan amount more than $5M.
  • You will get a loan without any documentation.
  • You will get the loan amount without any verification process.
  • You will get the loan for rental property

Do you know why Investors like to invest in Florida? 

Yes, of course I know why Investors like to invest real estate in florida. Here are the important reasons you need to know.

They are,

According to zillow statistics the average home price in florida is $377.706 compared to past year.

Median price of home in Florida has slightly increased, and it will be more than $373,990.

In 2023,  Florida one bedroom flat around $1500 which is far increasing compared to previous year.

7 Best Updated Places to Invest in Florida 

CityHome PriceRentAppreciation Value
Tampa $371,253$1,6909.1%
Spring Hill$244,134$1,4005.28
Orlando, FL$361,126$1,6528.3%
Palm Bay$242,535$1,6005.24%
St. Petersburg, FL$341,825$1,59611.2%

Wrap up

In this blog you will get detailed information about DSCR Loan in florida and how to apply for loan even as an individual.

If you are trying to get a DSCR Loan, Try to choose the best Lenders who are in florida.


How much do you need for a DSCR loan?

For a DSCR Loan you need more than 20% to 29%.

Are DSCR loans hard to get?

No, If you have a good DSCR ratio more than 1 you are eligible. If you have a good credit score of more than 630 it gives you more advantage too.

What is the interest rate for a DSCR loan in Florida?

According to current market value the average interest rate for DSCR loan in Florida will be 7.180% to 8.680%.

Do banks offer DSCR loans?

Yes, banks offer DSCR loans, and also in credit unions, private lenders and more.

What is the disadvantage of DSCR?

Higher mortgage rate than Traditional loan, Down payment minimum 20%,Service charges are there. These are some common disadvantages of DSCR.

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