What Banks Offer DSCR Loans?

A small number of banks offer DSCR loans, Axos Bank, North American Savings Bank, Quontic Bank, Primis Bank, KeySavings Bank and Northpointe Bank among them. But most DSCR lending happens outside the banking system entirely. The majority of these loans come from non-bank lenders: Non-QM mortgage companies, portfolio lenders, and private capital firms built specifically for real estate investors.

That distinction matters more than the list does. If you walk into a large retail bank and ask for a DSCR loan, you will usually be told no — not because you don’t qualify, but because the product isn’t on the shelf. Knowing which type of lender to approach saves weeks.

Why Most Banks Don’t Offer DSCR Loans

DSCR loans qualify the property rather than the borrower.

The lender divides the rental income by the full monthly payment and approves the loan if the ratio clears their threshold.

No tax returns, no W-2s, no personal debt-to-income calculation.

That structure puts the loan outside the qualified mortgage framework, which means it cannot be sold to Fannie Mae or Freddie Mac.

A lender who originates one either holds it on the balance sheet or sells it into private securitization.

Large banks built their residential mortgage operations around agency-eligible lending at scale. Holding investor loans in portfolio ties up capital and brings different regulatory treatment, so most simply don’t participate. The banks that do are generally smaller institutions, online banks, or community banks that made a deliberate choice to serve investors.

Non-bank lenders face none of that friction. Their entire business model is originating loans the agencies won’t buy — which is why they dominate the category and why their guidelines tend to be more flexible.

Case Study: A Florida Borrower Gets Cash-Out on a Short-Term Rental with Griffin Funding

The following is an illustrative example built from Griffin Funding’s published DSCR program guidelines. It is not an actual client file, and individual results depend on the property, the borrower, and current guidelines.

Consider an investor who owns a short-term rental near Tampa. The property is worth about $720,000 and carries a $380,000 first mortgage. He wants to pull equity out to buy a second vacation rental, but his tax returns show heavy depreciation and deductions — so his net income on paper looks far smaller than his actual cash flow. A conventional cash-out would be difficult.

This is the situation DSCR lending exists for. Here is how the structure works.

The property qualifies, not the borrower. A DSCR cash-out refinance divides the property’s rental income by its full monthly payment, including taxes, insurance, and any association dues. His tax returns never enter the calculation.

Short-term rental income can count. This is the piece that matters most for an Airbnb or Vrbo property, and lenders differ sharply on it. Griffin Funding’s published guidelines accept three documentation methods: a comparable rent schedule from the appraisal, AirDNA comparable data, or twelve months of platform remittance history from the booking site itself. An investor with a year of Airbnb payout records has a documented income stream most lenders would otherwise discount.

The numbers. At a 75% loan-to-value cash-out, his new loan would be roughly $540,000. After paying off the $380,000 first mortgage and closing costs, he nets around $145,000 — enough for a down payment and reserves on a second property.

With gross rental revenue around $7,500 a month and a full monthly payment near $6,500 including Florida’s substantial insurance costs, his coverage ratio lands near 1.15 — above the 1.0 threshold most lenders want, though below the 1.25 that earns the best pricing.

And if the ratio had come in below 1.0? Griffin publishes no minimum DSCR and funds sub-1.0 files when reserves support the deal. They also offer a no-ratio program that skips cash flow qualification entirely. For a high-value, low-yield property — common in coastal Florida — that path can be the difference between closing and not.

One structural alternative worth raising. Rather than refinancing the entire first mortgage, an investor holding a favorable existing rate can tap equity through a DSCR home equity loan or line of credit, which Griffin also offers. That leaves the first mortgage untouched. On a property financed during the low-rate years, preserving that first lien is often worth more than the simplicity of a single loan — a comparison covered in our guide to HELOCs on investment property.

What to Ask Any DSCR Lender

Guidelines vary enormously between lenders, and a decline from one says very little about the next. Ask every lender the same five questions:

• What is your minimum DSCR, and do you offer a no-ratio option? Answers range from 1.25 down to none at all.
• Do you accept short-term rental income, and how must I document it? Some require a long-term lease and will not count Airbnb revenue at all.
• What is your maximum LTV on a cash-out? Most cap at 75%, some reach 80%.
• Is there a prepayment penalty, and how is it structured? These are standard on DSCR loans and usually step down over three to five years.
• Will you lend to my LLC? Most will, and entity ownership is one reason investors choose DSCR in the first place.

For how the ratio itself is calculated and where the common miscalculations happen, see our DSCR loan guide. For cash-out mechanics specifically, our guide to DSCR cash-out refinancing covers LTV tiers and seasoning rules, and investment property cash-out refinances compares the conventional and DSCR routes.

The Reality of Banks and DSCR Loans

A handful of banks offer DSCR loans, and several do it well. But if you default to the bank where you keep your checking account, you will probably be turned away from a product you qualify for. Non-bank lenders write most of this volume, set more flexible guidelines, and compete for investor business in a way large retail banks do not.

Shop at least three, ask the five questions above, and verify every license number before you apply. See RefiGuide ‘s article on Best DSCR Lenders in 2026.

Frequently Asked Questions

Can I get a DSCR loan from my own bank?

Usually not. Most large retail banks limit residential lending to conventional and government-backed loans, because DSCR loans cannot be sold to Fannie Mae or Freddie Mac and must be held in portfolio or privately securitized. A few banks do offer them — generally online banks, community banks, and institutions with dedicated investor divisions. Your existing banking relationship rarely helps here. Ask specifically whether they have a DSCR or investor cash-flow program before assuming a decline means you don’t qualify.

Is a credit union or a non-bank lender better for a DSCR loan?

Non-bank lenders dominate DSCR lending and generally offer more flexible guidelines, including sub-1.0 ratios, no-ratio programs, and short-term rental income acceptance. Credit unions occasionally offer investor products but rarely at the same flexibility. That said, banks and credit unions holding loans in portfolio can sometimes make exceptions a securitizing lender cannot. The practical approach is to shop both — one non-bank specialist and one portfolio lender — and compare guidelines rather than assuming either category wins.

Do DSCR lenders require a personal guarantee?

Many do, even when the loan closes to an LLC. A personal guarantee means you remain individually responsible if the entity defaults, which undercuts one reason investors use entities. Requirements vary by lender and by loan size, and some waive the guarantee on larger or lower-leverage deals. Ask directly, because it affects your liability rather than just your paperwork. Also confirm whether the lender reports the loan to your personal credit, since that varies too.

References

Consumer Financial Protection Bureau. (2026). Ability-to-repay and qualified mortgage rule, 12 C.F.R. § 1026.43. 

Lender programs, state licensing, and guidelines change without notice. Nothing here is a promise of approval or a recommendation of a specific lender. Verify licensing at nmlsconsumeraccess.org and confirm current terms directly. RefiGuide.org is an advertising marketplace, not a lender, and receives compensation from participating providers.