Do Any No-Ratio DSCR Lenders Exist

Jason Taken

Lender · Chicago, IL · Member since 2021 · 424 posts · 145 votes

1y

75% - no ratio

0 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Jason Taken:

75% - no ratio

Cool. Where are you getting that and what are ballpark terms?
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Timothy Devitt

Lender · The Carolinas · Member since 2025 · 16 posts · 8 votes

1y

Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000
Lease Terms: 3-year lease at $4,000/month
Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

Hey Adam, Thanks for posting. I can lend to the higher of the market rent or the lease rent. Full leverage on Refi's are 75%

Let's chat!

0 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Timothy Devitt:
Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000

Lease Terms: 3-year lease at $4,000/month

Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

Hey Adam, Thanks for posting. I can lend to the higher of the market rent or the lease rent. Full leverage on Refi's are 75%

Let's chat!
These are new purchases. When you say leased rent, what counts? For example I am closing on a home on July 15, 2025. I sign the lease the day I close, does that work ---- does it have to be before closing?
0 Reply

Patrick Roberts

Lender · Charleston, SC · Member since 2019 · 1k+ posts · 1k+ votes

1y

No-ratio DSCR products are fairly common and will usually lend at ratios down to 0.8 with LTVs around 70% or less. A lot of lenders will also allow the higher of market rent vs lease if the lease is seasoned and performing (usually 3 months seasoning). This varies by product and by lender.

Are you using hard money to acquire these properties? If so, it might be simplest to just ride the hard money loan until the lease is seasoned so that you can use the lease terms rather than the 1007.

4 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Patrick Roberts:

No-ratio DSCR products are fairly common and will usually lend at ratios down to 0.8 with LTVs around 70% or less. A lot of lenders will also allow the higher of market rent vs lease if the lease is seasoned and performing (usually 3 months seasoning). This varies by product and by lender.
Are you using hard money to acquire these properties? If so, it might be simplest to just ride the hard money loan until the lease is seasoned so that you can use the lease terms rather than the 1007.

We acquire using banks right now but hitting limits. Are you suggesting buying all cash or with HML and letting it season to then do a refi with the new lease after 90 days?

......have not heard of that one but sounds interesting!
0 Reply
Patrick Roberts
Lender · Charleston, SC · Member since 2019 · 1k+ posts · 1k+ votes
1y
Quote from @Adam Zach:

Quote from @Patrick Roberts:

No-ratio DSCR products are fairly common and will usually lend at ratios down to 0.8 with LTVs around 70% or less. A lot of lenders will also allow the higher of market rent vs lease if the lease is seasoned and performing (usually 3 months seasoning). This varies by product and by lender.
Are you using hard money to acquire these properties? If so, it might be simplest to just ride the hard money loan until the lease is seasoned so that you can use the lease terms rather than the 1007.

We acquire using banks right now but hitting limits. Are you suggesting buying all cash or with HML and letting it season to then do a refi with the new lease after 90 days?

......have not heard of that one but sounds interesting!

I guess what we're really discussing here is how fast you want or need to turn your money over. If you're needing to refi out of the acquisition financing prior to or at lease-up, then you'll need a no-ratio DSCR. If you can leave your acquisition financing in place for about 3 months after lease-up, you should be able to use the higher rent amount from the lease because the lease is seasoned.
No-ratio DSCR refi's are going to be more expensive and bring lower leverage than regular DSCR refi's.
0 Reply
Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Patrick Roberts:

Quote from @Adam Zach:

Quote from @Patrick Roberts:

No-ratio DSCR products are fairly common and will usually lend at ratios down to 0.8 with LTVs around 70% or less. A lot of lenders will also allow the higher of market rent vs lease if the lease is seasoned and performing (usually 3 months seasoning). This varies by product and by lender.
Are you using hard money to acquire these properties? If so, it might be simplest to just ride the hard money loan until the lease is seasoned so that you can use the lease terms rather than the 1007.

We acquire using banks right now but hitting limits. Are you suggesting buying all cash or with HML and letting it season to then do a refi with the new lease after 90 days?

......have not heard of that one but sounds interesting!

I guess what we're really discussing here is how fast you want or need to turn your money over. If you're needing to refi out of the acquisition financing prior to or at lease-up, then you'll need a no-ratio DSCR. If you can leave your acquisition financing in place for about 3 months after lease-up, you should be able to use the higher rent amount from the lease because the lease is seasoned.
No-ratio DSCR refi's are going to be more expensive and bring lower leverage than regular DSCR refi's.

good points. ideally we would just get financing at closing and not jump through more hoops of seasoning and refi.....We do this with banks right now but scaling is issue. We are buying about $1M in assets per month across the Midwest/SE and hopeful we can fine THEE ONE that we can scale with

I appreciate your response.
0 Reply

AJ ExnerPro Member

Lender · Springfield, MO · Member since 2023 · 652 posts · 314 votes

1y

Hey Adam,

Yeah, that makes sense, and on top of the market rent situation, I know Kiavi/Lima require a pretty high minimum DSCR (1.1-1.2, I believe) while some will go down to 1.0 and will even use 110%-120% of market rents if yours comes in higher.

Sending over a DM, would love to connect and talk through the strategy a little more and see if we could help you find a reliable and repeatable model.

Good luck!

[email protected]417-427-2612

0 Reply

Mike GrudzienPro Member

Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes

1y

Good advice so far. Adam you got this!

0 Reply

Devin PetersonBusiness Member

Lender · Sarasota, FL · Member since 2022 · 2k+ posts · 664 votes

1y

Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000
Lease Terms: 3-year lease at $4,000/month
Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

Sounds like you need a true STR DSCR lender. Have a bunch of solutions for you happy to chat

[email protected]860-538-3672

ProAlpha Capital56 Reviews

Website View Page

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Derek BrickleyBusiness Member

Lender · Ann Arbor, MI · Member since 2021 · 664 posts · 226 votes

1y

Hey Adam!

Sounds like you've already gotten some input but yes. Not all DSCR is the same so you see no-ratio DSCR up to 75% LTV, though often use the higher of the two for debt-service ratio calculation. Also if you have significant funds set aside in reserves you can use that to supplement your rent as well to make a deal debt-service. If it's a primary residence, you can use no-ratio products up to 80% LTV. Feel free to reach out though if it helps to go over some of those in more detail!

[email protected]734-645-7722

Gold Star Mortgage Financial Group548 Reviews

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0 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Derek Brickley:

Hey Adam!
Sounds like you've already gotten some input but yes. Not all DSCR is the same so you see no-ratio DSCR up to 75% LTV, though often use the higher of the two for debt-service ratio calculation. Also if you have significant funds set aside in reserves you can use that to supplement your rent as well to make a deal debt-service. If it's a primary residence, you can use no-ratio products up to 80% LTV. Feel free to reach out though if it helps to go over some of those in more detail!

Interesting take on the reserves. May I ask what sort of Reserves make the deal better?
0 Reply

Scott WolfPro Member

Lender · Boca Raton, FL · Member since 2014 · 1k+ posts · 957 votes

1y

Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000
Lease Terms: 3-year lease at $4,000/month
Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

We can do 0.75 DSCR Ratio loans. And can use STR rental income with less seasoning if the borrower has experience.

0 Reply

Andrew Zamboroski

Lender · Member since 2021 · 495 posts · 130 votes

1y

Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000
Lease Terms: 3-year lease at $4,000/month
Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

As others have mentioned, you can generally go up to 70-75% ltv with a ratio down to .80%. You can also usually use 110-120% of market rent if you do have rent verification. If these are STRs, you can also use air dna projections on certain programs.

The one question that comes to mind is when you mention 10% down. Is that a deposit or are these lease to own situations?

0 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Andrew Zamboroski:
Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000

Lease Terms: 3-year lease at $4,000/month

Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!
As others have mentioned, you can generally go up to 70-75% ltv with a ratio down to .80%. You can also usually use 110-120% of market rent if you do have rent verification. If these are STRs, you can also use air dna projections on certain programs.

The one question that comes to mind is when you mention 10% down. Is that a deposit or are these lease to own situations?
Thanks Andrew. Even 110% of market rent doesnt get us to 75% LTV in most cases and yes AirDNA data is one way we are going....just difficult to get certainty for our tenant-buyers (yes they are putting down 10% option fee in most cases)
0 Reply

Jayne K Williams

Member since 2024 · 3 posts · 1 vote

1y

This is a good program you have here. I'm interested in doing the same. You're helping the community and making home buying a reality while winning at the same time.

0 Reply

Erik EstradaBusiness Member

Lender · Member since 2022 · 6k+ posts · 1k+ votes

1y

Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000
Lease Terms: 3-year lease at $4,000/month
Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

Hey Adam,

There are lenders that allow 100% of the actual leases as long as you can document 2 months of rental income received. Additionally you can do a no ratio loan however the rate will be significantly higher. Some lenders may require 12 months reserves, however there are a few that do not have that requirement.

I would suggest shopping it around more, if you have not closed yet.

[email protected]818-269-7983

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1 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Erik Estrada:
Quote from @Adam Zach:

Hey BP community,

We've been scaling a rent-to-own single-family housing model across the Midwest and Southeast and have run into a wall with traditional DSCR lenders.

We've been working with small local banks and credit unions to finance deals, but as we grow, we're looking for more scalable lending partners. We've tried groups like Lima One and Kiavi, but they just don't work for our model — their DSCR underwriting is based on market rents, not actual lease terms, and STR want 12 month's of existing performance.

Here’s an example deal:

Purchase Price: $400,000

Lease Terms: 3-year lease at $4,000/month

Market Rent: ~$2,500/month

Because DSCR lenders are using the lower market rent, we get capped on LTV and lose the leverage we need — even though our tenant-buyer is pre-approved, fully underwritten, and putting down 10%.

We operate two private real estate funds and close 2–4 single-family homes/month for pre-approved rent-to-own tenants. Each home is appraised, inspected, and fully underwritten with long-term lease commitments — and we’re looking for a strategic debt partner (bank, private lender, or broker) who can underwrite based on actual lease terms or use no-ratio underwriting.

Anyone have recommendations for lenders or brokers who specialize in no-ratio or flexible DSCR products?

I’d love to connect and happy to share more deal info if helpful.

Thanks in advance!

Hey Adam,
There are lenders that allow 100% of the actual leases as long as you can document 2 months of rental income received. Additionally you can do a no ratio loan however the rate will be significantly higher. Some lenders may require 12 months reserves, however there are a few that do not have that requirement.
I would suggest shopping it around more, if you have not closed yet.
good point and yes the 2 month is where the rub is since we close the same day they sign the lease, so unless we go all cash and then refi 2 months later....not sure if we can pull that one off...good ideas though. thanks!
0 Reply

Jake YuskaitisBusiness Member

Lender · New Jersey, USA · Member since 2022 · 254 posts · 67 votes

1y

I have some recommendations for no ratio. But they're expensive.

[email protected]551-287-6884

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1 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Jake Yuskaitis:

I have some recommendations for no ratio. But they're expensive.

cool. if something was a no prepaid and 1 origination what sort of rate and LTV are you seeing? 9%
0 Reply
Jake YuskaitisBusiness Member
Lender · New Jersey, USA · Member since 2022 · 254 posts · 67 votes
1y
Quote from @Adam Zach:

Quote from @Jake Yuskaitis:

I have some recommendations for no ratio. But they're expensive.

cool. if something was a no prepaid and 1 origination what sort of rate and LTV are you seeing? 9%

depends on FICO. you'd need more origination to buy down the PPP and you can only buy it down to 1 year.
you'd probably see something like this:
Term: 30 yr fixed
Rate: 8.5%+
LTV: 75%
Points: 3-4
PPP: 1 year
[email protected]551-287-6884
Frontier Funding LLC533 Reviews
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Spencer Terrien

Lender · San Francisco · Member since 2025 · 7 posts · 3 votes

1y

Hey @Adam Zach I have a contact at lender with no DSCR ratio.

More than happy to connect you both to see if it's a good fit.

Thank you.

1 Reply

Adam Zach
OP
Rental Property Investor · Fargo, ND · Member since 2016 · 136 posts · 112 votes
1y
Quote from @Spencer Terrien:

Hey @Adam Zach I have a contact at lender with no DSCR ratio.
More than happy to connect you both to see if it's a good fit.
Thank you.

sure!
0 Reply

Bridget BrickBusiness Member

Lender · Direct-to-Wholesale DSCR Loans | BRRRR & No-Seasoning Refi | 46 States · Member since 2025 · 53 posts · 11 votes

1y

Adam, you have a few options here. You can buy with cash and the next day put a delayed purchase loan in place for 80% LTV. Or you can finance based on the current lease but will need to show proof of lease + first month's rent and deposit.

The right lender can find a path forward.

[email protected]619-993-0504

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Do Any No-Ratio DSCR Lenders Exist

Do Any No-Ratio DSCR Lenders Exist

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