Common AcronymsHomebuying Glossary
DSCR
Also known as Debt Service Coverage Ratio
A ratio measuring whether a rental property's income is enough to cover its loan payments.
In plain English
DSCR divides a property's net operating income by its total debt payments — a ratio above 1.0 means the property generates enough income to cover its mortgage, which some investment-property lenders use instead of personal income to qualify a loan.
Why it matters
DSCR loans can let investors qualify for rental property financing based on the property's income rather than their personal W-2 income.
Related terms
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