How DSCR Is Calculated

What counts as rent

• A lease in place. The lender generally uses the lease rent, often checked against the appraiser's market-rent analysis; where the two differ materially, programs have rules about which controls.
• No lease yet — a purchase, or a vacant unit. The appraiser prepares a market-rent analysis (the single-family rent schedule or the small-income-property version for 2–4 units), and that figure is the rent.
• Short-term rentals. Some programs will use documented booking income — typically a trailing 12 months from the platform — often adjusted; others use only the long-term market rent even on a property you run as an Airbnb. The short-term rental page covers the difference.
• Multi-unit. Rents are added across units. A vacant unit is usually carried at market rent from the appraisal.

What counts as payment

• Principal and interest on the proposed loan. On an interest-only program, some lenders qualify on the interest-only payment, which raises the ratio; others qualify on the fully amortized payment regardless. It is one of the first questions to ask.
• Property taxes, typically at the rate that will apply after purchase, not the seller's grandfathered bill.
• Insurance — landlord hazard coverage, plus flood where the property sits in a flood zone.
• Association dues, for condos and many planned communities.

Moving the ratio

When a property lands below the ratio a program wants, the levers are the same ones that move any rental's cash flow. A larger down payment lowers the loan and the payment. A different loan structure can lower the qualifying payment. Documented rent above the appraiser's figure — a signed lease at a higher number — can raise the rent side. And some programs are built for properties that do not cover the payment at all, at a price. Which lever fits is a short conversation, and the calculator shows you the arithmetic before it.

Common questions