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Home/Locations/California/DSCR Loans
California Investment Financing

California DSCR Loans

Fast Approval for Investment Properties in the Golden State

No tax returns. No W-2s. No pay stubs. Qualify based on rental income alone. Rates from 5.99% • Close in 10-15 days

Get Free Rate Quote(949) 339-3555
640+ Credit Score
20% Down Payment
Close in LLC
Unlimited Properties

Free Chrome Extension: Analyze California Properties Instantly

Works on Zillow, Redfin, and 17+ sites. Auto-calculates DSCR, cash flow, and ROI as you browse. AI-powered analysis for every California listing.

Install Free
5.99%
Rates Starting At
10-15
Days to Close
$75K-$3M
Loan Amounts
80%
Max LTV

What is a California DSCR Loan?

A California DSCR (Debt Service Coverage Ratio) loan is a specialized real estate investment loan that qualifies you based on your property's rental income, not your personal income. This revolutionary financing method has transformed how investors scale their California rental portfolios.

California's unique real estate market—with property values averaging $800K+ and strong rental demand—makes DSCR loans particularly powerful. Whether you're targeting Los Angeles multi-families, Palm Springs vacation rentals, or Sacramento cash-flowing properties, DSCR loans let you qualify without tax returns, W-2s, or employment verification.

The DSCR ratio is simple: Monthly Rental Income ÷ Monthly PITIA Payment. A ratio of 1.0 means the property breaks even. California's competitive rental markets often produce ratios of 1.15-1.45, qualifying you for excellent rates and terms.

Why California is the #1 State for DSCR Loans

Strong Appreciation

California properties have appreciated 6-8% annually over the past decade. Leverage amplifies these gains, building equity you can tap with cash-out refinances.

High Rental Demand

With 45% of Californians renting, demand is consistent across all markets. LA, SF, and San Diego have sub-3% vacancy rates in quality neighborhoods.

Diverse Property Types

From urban condos to desert vacation rentals to suburban single-families, California offers every property type. DSCR loans finance them all.

Premium Rental Rates

California commands some of the nation's highest rents. Median rent in LA: $2,800. Orange County: $3,200. These rates support strong DSCR ratios.

Multiple Strong Markets

Unlike single-city states, California has 8+ major investor markets. Inland Empire offers 7%+ yields. SF offers appreciation. Diversify within one state.

Economic Resilience

As the 5th largest economy globally, California's diverse job market (tech, entertainment, agriculture, tourism) creates rental stability across cycles.

Frequently Asked Questions

Everything you need to know about California DSCR loans

While we can work with DSCR ratios as low as 0.75, a ratio of 1.0 or higher will get you the best rates and terms. A 1.25 DSCR is considered excellent and qualifies for premium pricing. California's high property values often produce strong DSCR ratios due to competitive rental markets.
We can close DSCR loans in California in as little as 10-15 business days. The timeline depends on appraisal turnaround (typically 5-7 days in California) and title work. We prioritize California deals and have established relationships with local appraisers and title companies.
Yes! California is one of our top markets for short-term rental (STR) DSCR loans. We use a 12-month average of actual rental income for established STRs, or projected income based on AirDNA market reports for new purchases. Palm Springs, San Diego, and Big Bear are particularly strong STR markets.
Minimum down payment is 20-25% depending on the property type and your DSCR ratio. For California properties with strong DSCR ratios (1.25+) and good credit (720+), 20% down is typical. Investment properties in California often appreciate quickly, building equity that can be leveraged for future purchases.
No. DSCR loans qualify you based solely on the property's rental income, not your personal income. This is perfect for self-employed California investors, business owners, or anyone who wants to scale their portfolio without income documentation limitations.
Minimum credit score is 640, but 680+ gets better rates. California investors with 720+ credit scores qualify for the best pricing (typically 5.99-6.75% as of 2025). We work with borrowers across the credit spectrum and can find solutions for most situations.
Yes. Most California investors close in an LLC for liability protection. We can close in single-member LLCs, multi-member LLCs, or personal names. California's legal structure makes LLC ownership attractive for rental properties.
We finance single-family homes, condos, townhomes, 2-4 unit properties, and even some mixed-use properties in California. Short-term rentals (Airbnb/VRBO) are eligible. Properties must be investment properties (not primary residences). We also finance properties in most California HOAs.
For leased properties, we use the lower of current lease or market rent (we can often use the higher amount). For vacant properties, we use 100% of appraiser's market rent. For short-term rentals, we use 12-month actual income average or AirDNA projections. California's strong rental market typically supports excellent DSCRs.
Prepayment penalty structures vary by lender. Most offer 0, 1, 2, or 3-year prepayment terms. Longer prepayment periods = better rates. Example: A 3-year prepayment penalty might save you 0.5% on your rate. Many California investors prefer the rate savings and plan to hold long-term anyway.
As of January 2025, California DSCR loan rates range from 5.99% to 8.25% depending on credit score, DSCR ratio, LTV, and prepayment period. Rates for California properties are competitive with other states. Use our rate calculator for a personalized quote based on your scenario.
There's no limit! Unlike conventional loans (capped at 10), DSCR loans allow unlimited financed properties. We have California clients with 20, 30, even 50+ properties financed with DSCR loans. This makes them perfect for scaling a California rental portfolio.
Yes. Foreign nationals and non-US citizens can qualify for California DSCR loans using an ITIN (Individual Taxpayer Identification Number) or even without one in some cases. California is a popular market for international investors due to strong appreciation and rental demand.
Yes. DSCR is calculated as: (Monthly Rental Income) ÷ (PITIA). California property taxes (typically 1% + special assessments) are included in the PITIA payment. Despite California's Prop 13 tax caps, you should factor in potential reassessment upon purchase when calculating your DSCR.
Yes! Cash-out refinancing is available up to 75% LTV for California DSCR loans. This is popular for pulling equity from appreciated California properties to fund additional purchases. No tax returns required. Great way to leverage California's strong appreciation to scale your portfolio.
California offers: 1) Strong rental markets with high demand, 2) Consistent appreciation (averaging 6-8% annually), 3) Diverse property types (urban, suburban, vacation rentals), 4) Pro-tenant laws that make professional property management essential, 5) High prices that benefit from leverage, and 6) Strong international investor interest.
Our free Chrome extension works on Zillow, Redfin, and 17+ real estate sites. As you browse California listings, it instantly extracts property data and calculates DSCR, cash flow, and ROI. The AI analysis feature provides market insights specific to the California city/neighborhood. It's like having an underwriter built into your browser.
California DSCR loan closing costs typically range from 2-4% of the loan amount. This includes: lender fees (~1%), appraisal ($500-800), title/escrow ($1,500-3,000), and recording fees. California transfer taxes vary by county. We provide a detailed fee breakdown upfront - no surprises.

Related Resources

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Expert comparison of the top DSCR loan lenders serving California investors.

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DSCR Calculator

Calculate your debt service coverage ratio and estimate your maximum loan amount.

Use Calculator →

Ready to Finance Your California Investment Property?

Get pre-approved in 24-48 hours. No tax returns required.

Get Started Now(949) 339-3555