LAMD-D16 DSCR Prime 680+ | DSCR Guidelines

Loan limits

Lien position: First lien
Minimum credit score: 680
Max LTV – purchase: 80% (700, ≤$1.5M)
Max LTV – rate/term refinance: 80%
Max LTV – cash-out refinance: 75%
Minimum loan amount: $100K (<$150K: 70/65, DSCR 1.25)
Maximum loan amount: $2.5M
Cash-out (cash in hand) limit: $500K above 65% LTV; $1M below 65%.
LTV reductions & overlays: 2–4 units and condos 75% purchase / 70% refi. Condotel and rural ineligible. Vacant/unleased refinance 70%. Interest-only 75% purchase/rate-term, 70% cash-out. Loans under $150K: 70% / 65% with DSCR 1.25+. Declining market and CT/IL/NJ/NY: 75% / 70%, $2M.

DSCR requirements

Minimum DSCR: 1.00
DSCR below 1.00: No
No-ratio (no DSCR calculated): No
How DSCR and qualifying rent are calculated: Monthly gross long-term rent ÷ PITIA (ITIA on IO), per unit; 120% lease/market caps as on the standard tier. Minimum DSCR 1.00. STR income not allowed.

Products & terms

Products: 15/30 fixed, 5/6 7/6 10/6 ARM
Interest-only: Yes – 75% purch/RT, 70% CO
Prepayment penalty: Same the program state rules
Reserves: 6 months; 9 months over $1.5M. Cash-out counts.

Borrower & credit

Housing payment history: 0x30x12 required on the primary residence and subject.
Credit events (BK, foreclosure, short sale, modification): 48 months for bankruptcy, foreclosure, DIL, pre-foreclosure, short sale, mortgage charge-off, lis pendens, notice of default.
Forbearance, deferrals & modifications: Forbearance, modifications and deferrals completed or reinstated more than 12 months before the note date are fine (normal housing-history rules apply). If completed within 12 months, they are not eligible on any of the DSCR programs.
Collections, charge-offs, judgments & liens: For DSCR loans, collections and charge-offs can be ignored unless they affect title. All open judgments and involuntary liens must be paid at or before closing (no subordination). IRS installment plans OK with 2+ on-time payments and no recorded lien in the subject's county. Credit counseling OK after 12 on-time months.
Tradelines & credit depth: 2 tradelines reporting 24 months (active in last 12) or 3 reporting 12 months; waived if the borrower has three credit scores. Representative score is from the borrower/guarantor with the highest score.
First-time homebuyer: No
First-time investor: Not eligible – must have owned and managed investment real estate at least 1 year in the last 3. FTHB ineligible.
Foreign national: No
ITIN borrower: No
Non-permanent resident: Yes
LLC / entity vesting: LLC, partnership or corporation limited to owning/managing real estate; US-domiciled; up to 4 members/managers; up to two entity layers allowed. Personal guaranties from members totaling at least 25% ownership, each completing an application – their credit is used for qualifying and pricing.
Gift funds & assets: Allowed after a 10% borrower contribution.
Financed property / exposure limits: Lender exposure to one borrower/household: $5M UPB or 10 loans.
Other borrower rules: N/A

Property

Eligible property types: SFR, 2-4, condo
ADUs & unpermitted additions: Same ADU rules as the standard tier (up to two ADUs; non-zoning-compliant ADUs acceptable with comps and insurance but earn no rent; legal ADU rent at the lower of market or actual). Short-term rent from an ADU isn't allowed because STR income is ineligible on this tier.
Non-warrantable condo: Condos are reviewed under the lender's own project rules rather than a warrantable/non-warrantable split: unit 500+ sq ft with a full kitchen and a bedroom, commercial space up to 50%, HOA delinquencies up to 20%, single-entity ownership up to 20% (5+ units), investor concentration up to 60% (higher possible with a rental history), non-structural litigation with damages under 25% of reserves. Established projects need 90% sold, 40% owner-occupied and HOA turned over; new projects 50% sold and 50% owner-occupied. Projects with critical repairs, unremediated special assessments, or safety violations are ineligible. Site condos use single-family LTVs. Lender project exposure: lesser of $5M or 20% of units.
Condotel: Not eligible.
Rural / acreage: Rural not eligible; max 5 acres.
Minimum square footage: SFR 700; 2-4 400/unit; condo 500
Mixed use: No
5+ units / multi-property: No
Ineligible properties: Manufactured/mobile homes, co-ops, timeshares and fractional ownership, boarding houses/B&B/PadSplit, healthcare/assisted-living use, properties with income-producing non-residential structures (billboards, cell towers, commercial workshops), agricultural features (vineyards, farms, ranches, orchards, equestrian), zoning violations or illegal use, domes, barndominiums, log homes not common to the area, houseboats, Native American reservation land, marijuana-related use, properties not accessible by standard roads or not suitable for year-round use, C5/C6 condition or Q6 quality, Hawaii lava zones 1–2 and coastal-erosion zones. Over 20 acres ineligible (no truncating). Leaseholds eligible where common.
Declining markets: Declining market (per appraisal or lender-designated state): max 75% purchase / 70% refinance and $2M loan (FN: 70% refi, $2M; 5–8/mixed use: no adjustment).
Appraisal, review & insurance: Full interior/exterior appraisal plus review product (or second appraisal); second appraisal required over $2M and on HPML flips (price up 10% within 90 days or 20% within 91–180 days of the seller's purchase). Transferred appraisals accepted. Escrow holdbacks not purchased.

Rental income

Rent used on a purchase: Same 120% lease/market rules as DSCR; vacant OK
Rent used on a refinance: Lease required (else max 70%)
Vacant / unleased refinance: Allowed at the lesser of 70% or the grid.
Short-term rental (Airbnb/VRBO): No
Short-term rental documentation: N/A
Short-term rental limits: Short-term rental income is not eligible.

Refinance seasoning

Cash-out seasoning: Six months of ownership to use the current appraised value; under 6 months, value is limited to price plus documented improvements (except inherited or divorce-awarded property). Not eligible if there was a cash-out within the past 6 months, for land-contract payoffs, with a POA, or if proceeds go to personal debts/taxes/judgments. Paying delinquent taxes (60+ days) or refinancing a free-and-clear property counts as cash-out.
Delayed financing (cash purchase recoup): Allowed for cash purchases within 6 months, treated as rate/term for pricing (cash-in-hand caps don't apply, except foreign nationals). Arm's-length purchase, documented funds, no liens; loan limited to documented investment, value capped at price plus improvements.
Recently listed for sale: For all refinances, value is the lower of the lowest list price in the prior 12 months or appraisal. Cash-out on an investment property listed within the past 6 months is allowed only with at least a 3-year prepayment penalty; any active listing must be cancelled before closing.

Other terms

Seller / interested-party concessions: Investment property: interested-party contributions up to 6%, for closing costs and prepaids only (never down payment or reserves). A borrower acting as their own agent may contribute commission within the limit. Excess reduces both price and value.
Secondary financing: Not permitted on the DSCR programs (closed-end seconds are a separate product).
State & local restrictions: Not available in Baltimore City MD, Philadelphia County PA, Puerto Rico, Guam or USVI. 2–4 units not eligible in IL and NY. CT, IL, NJ, NY overlay: max 75% purchase / 70% refi and $2M (FN: 70% refi, $2M). Prepayment penalties not allowed in AK, MI, NM, OH; in IL and NJ only for entity borrowers; PA not on 1–2 units at or below about $329K; MS declining only.

Additional details

Notes: Prime-credit DSCR tier (no STR, no rural, no condotel). Some state and county exclusions apply.

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