Conventional financing caps investors at 10 financed properties and ties every new deal to personal debt-to-income ratios. DSCR financing removes both ceilings by qualifying each property on its own rent coverage—not the borrower’s personal income.
The refinance is where the BRRRR strategy either works or stalls. A DSCR loan is the most common way investors exit short-term financing after a rehab and lock in a long-term, cash-flowing rental—and it qualifies on the property’s income, not yours.
Self-employed real estate investors have a financing problem that has nothing to do with money. Conventional lenders want W-2s and two years of tax returns—and when you write off aggressively (as you should), your taxable income looks too low to qualify. DSCR financing sidesteps all of it by qualifying the property’s rental income instead of the borrower’s personal income.