Who it is for
- Buying your first or next rental property
- Investors choosing between DSCR and conventional
- Refinancing rentals into better terms
Typical Investment Property Loans requirements
| DSCR option | Qualify on rent; 20-25% down; no income docs |
|---|---|
| Conventional investor option | 15-25% down; lower rates; 10-property cap; reserves required |
| Occupancy | Non-owner-occupied only |
| Vesting | Individual or LLC |
Figures are typical market ranges as of October 2026. Actual terms depend on the lender, your credit, the property and the program, and are confirmed on your Loan Estimate or term sheet.
How it works
- Decide whether rent or personal income is the stronger qualification.
- DSCR path: rent schedule and appraisal. Conventional path: full income docs.
- Close in your name or LLC.
Pros and cons
Advantages
- Multiple paths to fit your situation
- LLC vesting on investor programs
Trade-offs
- Larger down payments than primary homes
- Higher rates than owner-occupied loans
Documents you’ll need
- Lease or rent schedule
- Down payment and reserve statements
- Entity documents for LLC vesting
Investment Property Loans FAQ
DSCR or conventional for an investment property?
DSCR usually wins when your tax returns understate income or you are past conventional property limits; conventional usually wins on rate when you have strong W-2 income and few properties.
How much down for an investment property?
Typically 15-25% depending on the program and your credit.
What are the main ways to finance a rental?
DSCR loans (qualify on rent), conventional investor loans (qualify on your income, lower rates), and portfolio or blanket loans for scale. The right one depends on your income picture and how many properties you own.
How many investment properties can I finance?
Conventional caps at 10 financed properties. DSCR and portfolio loans generally have no cap.
Do I need reserves for an investment property loan?
Yes. Most lenders want 3 to 12 months of payments in reserve after closing, more for multiple properties.
Can I close an investment property in an LLC?
With DSCR and most investor programs, yes. Conventional loans in an LLC are harder; many investors close personally then transfer, but check with your lender and attorney first.
Are investment property rates higher?
Yes, typically 0.50 to 1.50% above primary home rates, depending on the program and your down payment.
Can I use rental income from the property I am buying?
DSCR uses it directly. Conventional allows 75% of market rent (per the appraisal) to offset the payment, minus vacancy.
What is the 1% rule?
A screening rule: monthly rent should be about 1% of the purchase price for the numbers to work. It is a rough filter, not a law. Run the actual DSCR and cash flow before deciding.
Official sources
How Investment Property Loans compare
| Investment Property Loans | DSCR Loans | Portfolio & Blanket Loans | Fix and Flip Loans | |
|---|---|---|---|---|
| Best for | Buying your first or next rental property | Investors whose tax returns show low income after write-offs | Investors with 5+ rentals | Buying distressed or dated properties to renovate and sell |
| Down payment | , | 20–25% down; up to 80% LTV on purchase | , | , |
| Credit | , | Typically 620–680 (some programs 600) | , | Typically 620–680 |
| Income docs | , | , | , | , |
Typical ranges, your Loan Estimate or term sheet confirms actual terms.
Coming soon: a 2-minute walkthrough from our loan team.
Related programs
DSCR Loans
A DSCR loan is an investment-property mortgage that qualifies you on the property’s rental income divided by its monthly payment (the debt service coverage ratio).
Portfolio & Blanket Loans
A blanket (portfolio) loan finances several investment properties under one note, one closing and one monthly payment, with release clauses that let you sell individual properties.
Fix and Flip Loans
A fix and flip loan is short-term (usually 12–18 months), interest-only financing that covers most of a distressed property’s purchase price and up to 100% of renovation costs, repaid when you sell or refinance.