LAMD-D03 DSCR Standard (No Minimum DSCR, ITIN) | DSCR Guidelines

Loan limits

Lien position: First lien
Minimum credit score: 620
Max LTV – purchase: 80% (700+ & 680–699, ≤$1.5M)
Max LTV – rate/term refinance: 80% (limited cash-out)
Max LTV – cash-out refinance: 75% (720+/700–719, ≤$1.5M)
Minimum loan amount: $75K
Maximum loan amount: $3.0M
Cash-out (cash in hand) limit: Unlimited below 55% CLTV with 680+; $1M at 55% or less under 680, at 55–65%, or above 65% with 700+; $500K above 65% under 700. Non-occupant co-borrowers can't do cash-out.
LTV reductions & overlays: DSCR 0.75–0.99: 680 FICO, 75% purchase/rate-term, 70% cash-out. DSCR under 0.75: 680 FICO, 70% / 65%. Vacant refinance: 70%. Condotel 75% (680+, $1.5M) to 65%. Cash-out 6–12 months after purchase: −5%. Quitclaim acquisition within 12 months: 65%. First-time homebuyer: 70%, $1M. Florida new-construction PUD 75%, condo 70%.

DSCR requirements

Minimum DSCR: No minimum for SFR/2-4 (condo/condotel min 1.00)
DSCR below 1.00: Yes – DSCR <1 needs 680 FICO; cash-out <0.75 max 65%, 0.75–0.99 max 70%
No-ratio (no DSCR calculated): Yes (no minimum DSCR on non-condo)
How DSCR and qualifying rent are calculated: Gross rent ÷ PITIA (IO: ITIA qualified at the amortizing ITIA). No minimum DSCR for SFR/PUD/2–4 units (condos and condotels need 1.00). Long-term rent at 100%; month-to-month OK. A new lease above market needs 2 months' payments and is capped at 125% of market on refinances. Short-term rent counted at 75%. Leases to the borrower's own companies not accepted.

Products & terms

Products: 5/6 ARM, 30yr fixed, 40yr fixed
Interest-only: Yes – 120 mo IO, min FICO 680
Prepayment penalty: Investment only, per state
Reserves: 3 months up to $1M, 6 months $1M–$2M, 12 months above $2M.

Borrower & credit

Housing payment history: 0x30x12 and 0x90x24. Payments on a manufactured home or second mortgage count as mortgage history.
Credit events (BK, foreclosure, short sale, modification): Bankruptcy, foreclosure, short sale, deed-in-lieu, loan modification, forbearance, deferral and 120+ day lates all count as credit events and need 48 months (bankruptcy measured from discharge/dismissal to closing). More than one bankruptcy in 7 years requires 7 years from the latest.
Forbearance, deferrals & modifications: Forbearances, deferrals and modifications are credit events (48 months). Exception: after a COVID-19 forbearance the borrower is eligible once 3 consecutive on-time payments are made by the note date.
Collections, charge-offs, judgments & liens: Collections/charge-offs under 24 months old may stay open up to $2,000 total; 24+ months up to $2,500 each; time-barred and all medical collections may stay open. On the DSCR grade, any balances above those limits must be paid in full.
Tradelines & credit depth: N/A
First-time homebuyer: Allowed: max $1M, 680 FICO, 70% CLTV, DSCR 1.00+, 10% own funds, no IO, no STR, payment shock under 300%. (FTHB = no ownership of residential property in the US in 3 years; entity ownership of 25%+ counts.)
First-time investor: Not separately restricted; FTHB rules apply (680, Tier A, no STR, $1M)
Foreign national: No
ITIN borrower: ITIN borrowers eligible on this program.
Non-permanent resident: Allowed with 700 FICO (approved visa list).
LLC / entity vesting: Individual or LLC/corporation with up to 4 owners, all of whom must be borrowers and guarantors.
Gift funds & assets: Allowed with a 10% minimum borrower contribution (under 80% CLTV). Overseas assets and 1031 funds eligible.
Financed property / exposure limits: No limit on other financed properties. Lender exposure: $5M or 10 loans per borrower within any 6-month span.
Other borrower rules: N/A

Property

Eligible property types: SFR, PUD, 2-4, warrantable & non-warrantable condo, condotel, SFR rural
ADUs & unpermitted additions: One-unit homes with ONE ADU are eligible (multiple ADUs not permitted); the ADU needs a full kitchen and bath. Unpermitted ADUs, outbuildings and conversions are acceptable when they're excluded from the appraised value, typical for the area, and the title commitment shows no permit violations – but they earn no value. ADU rent can count when the appraisal shows zoning compliance is legal (a permit itself is not required to establish that) with at least one comp that has an ADU. Purchase: lower of 1007 or actual rent; refinance: 1007 rent with the current lease and 2 months' receipts. ADUs can't be used for short-term rent.
Non-warrantable condo: Warrantable and non-warrantable condos eligible under a limited review: single-entity ownership up to 2 units in 5–20 unit projects or 30% in 21+ units; commercial space up to 50%; other features case-by-case. Review waived for detached units and 2–10 unit projects (not condotels). Minimum DSCR 1.00 for condos. Florida new-construction condos capped at 70%.
Condotel: Allowed: 500+ sq ft with full kitchen and separate bedroom (kitchenettes case-by-case), no 'motel' in the name, no mandatory rental pools, no termination/bankruptcy proceedings, not rural or agricultural zoning, 660+ FICO. Lender finances at most 20% of units in projects over 10 units. Minimum DSCR 1.00.
Rural / acreage: Rural/agricultural properties allowed (rural = rural or agricultural zoning, appraiser designation, or factors like 50%+ vacant land use, 10+ acre neighbors, outbuildings, unpaved road, population under 25,000): 680 FICO, 1 unit only (one ADU allowed), neighborhood at least 25% built up, not a working farm or income-producing, max 10 acres. Rural condos and rural condotels are not eligible.
Minimum square footage: 500 sq ft living space
Mixed use: Not published – ask us about your scenario
5+ units / multi-property: No
Ineligible properties: C5/C6 or fair/poor condition, Q6 construction, under 500 sq ft (each unit), model leasebacks, private transfer covenants, commercial, co-ops, domes, geothermal homes, timeshares, over 10 acres, unique properties, assisted living, working farms/ranches/orchards, mobile and manufactured homes, 5–8 units, mixed use, incomplete properties, barndominiums. Leaseholds are case-by-case (never tribal land). Every unit needs a full kitchen with a stove or stove hookup.
Declining markets: N/A
Appraisal, review & insurance: Full appraisal (no waivers) plus a secondary valuation up to $2M; second appraisal above $2M. Points and fees under 7%.

Rental income

Rent used on a purchase: Lease or 1007/1025; new lease with 2 mo payments
Rent used on a refinance: Lease or 1007; lease >125% of 1007 capped at 125% unless 2 cancelled checks support
Vacant / unleased refinance: Allowed at max 70% CLTV using 1007 market rent.
Short-term rental (Airbnb/VRBO): Yes (not for FTHB)
Short-term rental documentation: 12-month average from the STR agreement/platform, or a 1007 showing STR rent. Purchases with no history may use 75% of an AirDNA Rentalizer estimate (60%+ occupancy) or 75% of a 1007 with STR comps. Not allowed on a refinance while a long-term lease is in place. Borrower signs an STR addendum and must meet local rules.
Short-term rental limits: 75% of STR income used; not available to first-time homebuyers; banned in VT and NYC boroughs (except condotels); STR-community properties subject to rate-sheet CLTV caps.

Refinance seasoning

Cash-out seasoning: Existing first mortgage must be 6+ months old. Under 6 months on title only with delayed financing, a no-value quitclaim within 12 months (max 65%), inheritance/divorce award, or time in the borrower's majority-owned LLC or revocable trust. 6–12 months: −5% from the grid, renovations must justify the value, and if listed after purchase value is the lower of list price or appraisal.
Delayed financing (cash purchase recoup): Cash purchases within 6 months: treated as cash-out; loan capped at total cash investment (price plus documented improvements); value is the lower of appraisal or cost; gifts used to buy can't be reimbursed.
Recently listed for sale: Rate/term: must be off the market by application. Cash-out: not listed within 6 months of application. Investment property listed within the past 12 months requires a 36-month prepayment penalty that can't be bought down (unless the state prohibits prepays).

Other terms

Seller / interested-party concessions: 6% at CLTV of 80% or less, 4% above. Not allowed when the purchase price exceeds list price by 3% or $5,001.
Secondary financing: N/A
State & local restrictions: Not available in Hawaii, Maryland or the US Virgin Islands. STR income not allowed in Vermont or NYC's five boroughs (except condotels). Florida new-construction PUDs 75%, condos/condotels 70%.

Additional details

Notes: Excluded: HI, MD, VI. FL PUD 75%. Payment shock >300% ineligible. Interested party 6% (≤80 CLTV) / 4%. Points & fees <7%. 1031 & overseas assets eligible.

← LAMD-D02 · All programs · LAMD-D04 →