LAMD-D09 DSCR Standard 0.75+ | DSCR Guidelines

Loan limits

Lien position: First lien
Minimum credit score: 660 (additional borrowers 640)
Max LTV – purchase: 80% (720, $125K–$1.5M; 700 ≤$1M)
Max LTV – rate/term refinance: 80% (720, ≤$1M)
Max LTV – cash-out refinance: 75% (720, ≤$1M); 700: 70%
Minimum loan amount: $75K ($75K–$125K requires DSCR 1.00; ≤$100K max 70%)
Maximum loan amount: $3.0M
Cash-out (cash in hand) limit: Unlimited at 60% LTV or less; above 60%, $1M (or unlimited with 18 months of reserves excluding cash-out).
LTV reductions & overlays: 1x30x12 housing: −5%. 2 units refinance 80%; 3–4 units refinance 75% (70% if DSCR under 1.00). Non-warrantable condos: 80% purchase/rate-term at 720+ (75% under 720), cash-out 75% / 70%. Condotels: 75% at 700+ (70% at 680), cash-out 70% / 65%, max $2M. Florida condos 75% on cash-out. STR: lesser of 75% or the grid, DSCR 1.15. Rural resort-area properties 65% with DSCR 1.00. IO max 80% (700 FICO if DSCR under 1.00). Declining market −5% above 65%.

DSCR requirements

Minimum DSCR: 0.75 (STR 1.15; <$125K 1.00)
DSCR below 1.00: Yes – 0.75–0.99: 740 → 75/75/70 ($1M–1.5M), 75/75/60 ($2M); 720 → 75/75/70 ($1M), 70/70/65 ($1.5M), 65/65 ($2M); 700 same as 720; 680 → 65/65/60 ($1M)
No-ratio (no DSCR calculated): No
How DSCR and qualifying rent are calculated: Gross rent ÷ fully amortizing PITIA (ITIA on IO). Minimum DSCR 0.75 (1.00 for loans under $125K; 1.15 for STR). Purchase: market rent (property may be vacant). Refinance: lesser of lease or market needs nothing more; a higher lease needs 2 months' receipts (not prepaid; not for monthly/seasonal rentals); seasonal/monthly rentals use a 12-month average; a vacant unit in a 2–4 uses 100% of market.

Products & terms

Products: 15/30 fixed, 30yr fixed IO; 2-1 buydown (purchase, 680+, DSCR ≥0.75)
Interest-only: Yes – 30yr fixed IO, max 80%; 700 FICO if DSCR <1
Prepayment penalty: Required on investment where permitted (no-PPP pricing per rate sheet)
Reserves: 3 months up to $500K at 80% LTV or less; 6 months up to $500K above 80%, or $500K–$2M; 12 months above $2M; 2–4 units at 80% need at least 6. Cash-out counts.

Borrower & credit

Housing payment history: 0x30x12 – no reduction; 1x30x12 – 5% LTV reduction. Subject and primary payments not on credit need an institutional VOM/VOR.
Credit events (BK, foreclosure, short sale, modification): 2 years' seasoning for housing events and bankruptcy on this tier (definitions above).
Forbearance, deferrals & modifications: Forbearance is treated as a housing event and must meet the program's housing-event seasoning (unless caused by a FEMA-declared disaster).
Collections, charge-offs, judgments & liens: Collections/charge-offs under 24 months may stay open up to $5,000 combined; all medical and factoring-company collections can stay; the rest can stay if covered by extra reserves; otherwise paid.
Tradelines & credit depth: N/A
First-time homebuyer: No
First-time investor: Allowed with DSCR 1.00+ and 700 FICO, no exceptions; can't be a first-time homebuyer.
Foreign national: No
ITIN borrower: No
Non-permanent resident: Allowed with US credit (ITIN, DACA, foreign nationals ineligible on this tier).
LLC / entity vesting: Yes; qualifying member ≥25% ownership
Gift funds & assets: After a 5% borrower contribution at any LTV; not for reserves; no gift of equity.
Financed property / exposure limits: Lender exposure: lesser of $10M or 10 loans, and $5M or 5 cash-out/5–8 unit loans (no-ratio: $7.5M/10 loans, $5M/5 cash-outs). Up to 20 financed properties including LLC-held.
Other borrower rules: Property can't be occupied by the borrower, any LLC member or family; no single-room or boarder leases. Renters need an active lease; the primary should be in a different area or superior to the subject. Rent-loss insurance of 6 months (or 3 extra months of reserves not from cash-out).

Property

Eligible property types: SFR, PUD, townhome, 2-4, warrantable & non-warrantable condo, condotel
ADUs & unpermitted additions: Homes with one or more ADUs (granny units, in-law suites) are acceptable when typical for the market and the property conforms to zoning. The ADU does NOT have to be permitted, as long as the appraiser says it's a legal use of the property and was built skillfully; legal non-conforming is fine if it doesn't hurt value. Two comps with a similar setup are required. Multiple ADUs are OK where the municipality allows them and the appraiser confirms compliance. The ADU must be substantially smaller than the main house, or the property is treated as 2–4 units. If any of these aren't met, the ADU gets no value. ADU rent can count when these rules are met and market rent is on the 1007. Unpermitted additions/modifications: appraiser comments they look professionally done and the use conforms to zoning.
Non-warrantable condo: Non-warrantable condos allowed (where the program permits): one owner may finance 2 units in 5–20 unit projects; commercial up to 50%; HOA delinquencies up to 25%; investor concentration up to 70% (higher for investment purchases); single-entity ownership up to 49% (developer-held units for sale excluded; 50%+ by exception); developer control OK with defined turnover; mandatory outside club dues OK; non-structural litigation. Leasehold condos are ineligible.
Condotel: Must be in a resort area or affiliated with a national hotel chain; full-size kitchen and at least one separate bedroom (studios case-by-case; units under 400 sq ft need similar-size comps). Condotel = run as a hotel, hotel/motel/resort/lodge name, front desk/housekeeping rentals, a hotel conversion, or marketed as a hotel. Short-term rental ability alone doesn't make it a condotel.
Rural / acreage: Rural (under 25% built-up, agricultural zoning nearby, dirt road, comps over 5 miles, population under 25,000, amenities over 25 miles, 10+ acre lots, large outbuildings) must not be agricultural or income-producing, can't receive farm/idle-acreage tax breaks, and must be year-round. Investment acreage capped at 5 acres (2 acres on the prime tier, no-ratio and 5–8 unit programs).
Minimum square footage: No minimum (full kitchen required; condos <400 sq ft need similar comps); 5–8 units 400 sq ft/unit
Mixed use: No
5+ units / multi-property: No
Ineligible properties: Container homes, assisted living, Baltimore City row homes, boarding houses, farms/hobby farms, leasehold condos, farm tax-abatement properties, rent-controlled properties (annual-increase caps alone are OK), unique properties (earth/berm, domes, barndominiums, churches), timeshares, C5/C6 condition (C4 reviewed; no structural deferred maintenance), 2+ detached homes on one lot unless typical with comps, blanket mortgages. Log-façade homes OK with comps (not true log cabins). Co-ops and manufactured homes only through delegated correspondents. Islands without a bridge case-by-case.
Declining markets: 5% LTV reduction when LTV is above 65%.
Appraisal, review & insurance: N/A

Rental income

Rent used on a purchase: Market rent
Rent used on a refinance: Lesser of lease or market; higher lease w/ 2 mo receipt (not for monthly/seasonal)
Vacant / unleased refinance: Refinances must be leased, except STRs, recently built/rehabbed properties, delayed financing, or 1 vacant (listed) unit in a 2–4. No cash-out on unleased rehabbed properties or delayed financing under 720 FICO.
Short-term rental (Airbnb/VRBO): Yes
Short-term rental documentation: Any of: 1007/1025 with STR rents, an AMC STR analysis (with comp addresses), or a 12-month look-back of receipts (bank or platform statements) plus a 1007/STR analysis. Seasonality must be addressed or a 50% vacancy factor applies. Refinances must be actively marketed as STR. Third-party proof (Property Guard, Vrolio) that STRs are allowed. Purchase or refinance.
Short-term rental limits: DSCR 1.15 minimum; LTV lesser of 75% or the grid; not in NYC.

Refinance seasoning

Cash-out seasoning: 6 months from the most recent transaction (except delayed financing).
Delayed financing (cash purchase recoup): Yes
Recently listed for sale: Investment properties must be off the market before closing when the new loan has a prepayment penalty (before application if no prepay). If listed within 6 months, value is the lower of appraisal or lowest list price.

Other terms

Seller / interested-party concessions: Interested-party contributions up to 6% of the lower of price or value on investment properties; giveaways under $1,000 ignored; excess deducted from price.
Secondary financing: Only with the lender's own second-lien product.
State & local restrictions: Investment properties ineligible in Charlotte, Lee, Hendry and Glades Counties FL; Indianapolis; Paterson NJ; Lubbock TX. All loans ineligible in Cook County IL, Baltimore City MD, Orange County NY and several Philadelphia ZIP codes (no Philadelphia row homes). Hawaii delegated correspondents only. STRs not allowed in NYC's five boroughs. Brooklyn and Memphis investment loans need a field review. Texas: no ITIN/foreign national loans for citizens of China, Russia, Iran, North Korea. Puerto Rico, Guam, USVI ineligible.

Additional details

Notes: 2-unit refi max 80%; 3-4 unit refi 75% (DSCR ≥1) / 70%. Rent loss insurance 6 mo PITIA (or +3 mo reserves). Declining market −5% when LTV >65. C3 condition expected. Grid ≥1.00 (purch/RT/CO): 720 → ≤$100K 70/70/65, ≤$125K 75/75/70, ≤$150K 80/80/75, $1M 80/80/75, $1.5M 80/75/70, $2M 75/75/60, $2.5–3M 70/70/60; 700 → $1M 80/75/70, $1.5M 75/75/70, $2M 70/70/60, $2.5–3M 70/70/60; 680 → $1.5M 75/75/70, $2–2.5M 70/70/60; 660 → $1M 70/70/60, $1.5M 70/70/55, $2M 65/55/50.

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