Some of the best cash-flowing rentals in the country sell for prices that put the loan right at, or just under, the DSCR minimum. Knowing how the $150,000 floor works, and how to build a deal that clears it, matters far more in Cleveland or Memphis than it does in Denver or San Diego, where almost every rental produces a larger loan.
In short: LendingStreet's DSCR loans start at $150,000, so small balance loans from $150,000 to about $250,000 are a normal part of the program. They qualify on the property's rent with no W-2s or tax returns, with up to 80% LTV on purchases, up to 75% on cash-out, a 1.0x standard minimum DSCR and a 620 minimum credit score. If a single property is too inexpensive to reach $150,000, a 2-4 unit building or a blanket loan on several rentals is usually the answer.
The minimum applies to the loan amount, not the price. At 80% LTV on a purchase, a property needs to be worth about $187,500 to produce a $150,000 loan. On a cash-out refinance at 75% LTV, the value needs to be about $200,000.
That means a $120,000 single-family home cannot carry a DSCR loan on its own at normal leverage, even if it rents well. Putting more money down makes the problem worse, because it shrinks the loan further.
The table shows where common prices land.
| Price or value | LTV | Loan amount | Meets $150,000 minimum? |
|---|---|---|---|
| $140,000 | 80% | $112,000 | No, below $150,000 |
| $187,500 | 80% | $150,000 | Yes |
| $200,000 | 75% | $150,000 | Yes |
| $250,000 | 80% | $200,000 | Yes |
| $320,000 | 75% | $240,000 | Yes |
In much of the Midwest and South, rentals that cash flow well sit near the minimum. Cleveland and Akron in Ohio, Detroit and Flint in Michigan, Indianapolis and Fort Wayne in Indiana, Memphis in Tennessee, Birmingham in Alabama and parts of upstate New York such as Buffalo and Rochester all have rental stock where a good single-family home or duplex prices in the high $100,000s to mid $200,000s.
These markets often have strong rent compared with price, which helps DSCR. The catch is that property taxes in some of them, such as Ohio, Michigan and upstate New York, can be high relative to value, and older housing stock can carry higher insurance and repair costs. Both show up in the ratio.
An investor buys a duplex in a Cleveland-area suburb for $200,000 with 25% down, so the loan is $150,000, right at the minimum. Each side rents for $1,050, or $2,100 combined.
Estimated principal and interest on a 30-year loan is about $1,075 per month. Estimated taxes are about $350 and insurance about $140 per month, for a total of about $1,565.
Rent of $2,100 divided by $1,565 gives a DSCR of about 1.34x, comfortably above the 1.0x standard minimum. The same investor buying a single-family home at $140,000 would fall short of the loan minimum, which is why many small-balance investors look at 2-4 unit properties first.
This example is illustrative and not a quote. Taxes, insurance and rent should come from the actual property.
If your target property is under the price that produces $150,000, these are the usual routes.
Title, appraisal, recording and legal costs do not shrink much when the loan does. On a $160,000 loan they are a much larger share of the balance than on a $600,000 loan, so build them into your return before you make an offer.
Taxes and insurance behave the same way. On a large loan, principal and interest dominate the payment. On a small loan, a $300 monthly tax bill can be a third or more of the total, so a tax reassessment or insurance increase moves DSCR quickly. Use the actual tax bill and a current insurance quote, not a seller estimate, and check whether the county reassesses after a sale, since some do and the new bill can be higher than the seller's.
Separate DSCR loans keep each property independent, which makes selling one simple. A blanket portfolio loan qualifies on portfolio cash flow, uses one closing and one payment, and includes release provisions so a property can be sold off later.
For investors buying several inexpensive houses in one city, the blanket route often solves the minimum problem and reduces closing work at the same time. Compare both on our blanket versus individual loans guide.
Small balances use the same rules as any DSCR loan. You qualify on rent, not personal income. LLC borrowers are standard, 30-year terms are available, and the minimum credit score is 620. If the rent comes in a little below the payment, sub-1.0 DSCR programs exist on some properties.
Our investor loans are business-purpose loans on non-owner-occupied property, so the home must be a rental, not a place you live.
Use the form below or call (877) 298-1001 with the address, price, rent and tax bill. If the property is under the minimum on its own, tell us what else you own or plan to buy and we can show a structure that works.
For local detail, see our DSCR pages for Cleveland, Memphis, Birmingham and Indianapolis.
DSCR loans start at $150,000. There is no stated maximum.
Not on its own, because even at 80% LTV the loan would be $80,000, well below the $150,000 minimum. Combining it with other rentals in a blanket loan, or choosing a higher-priced 2-4 unit property, are the usual solutions.
It helps DSCR but hurts the minimum, because a bigger down payment means a smaller loan. Near the floor, more leverage is often what makes the deal work.
Blanket portfolio loans cover 5 or more investment properties, each with 1-8 units, under one loan.
Pricing depends on the full file, including credit, leverage, DSCR and property type. Closing costs take a larger share of a small loan, so compare total cost, not just the payment.
On some programs, short-term rentals can qualify on projected rental income. Local permit and zoning rules decide whether the property works, so check with the city or county first.
No. Small balance DSCR loans qualify on the property's rent, not personal income.
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