DSCR Loan pennsylvania
- LTV: 75%
- Term: 30 Year
- Rate: 7.85%
- Points: 2.0%
What are DSCR Loans used for in Pennsylvania?
1. Pittsburgh
2. Philadelphia
What are dscr loans used for in Pennsylvania?
DSCR loans are a powerful financing tool for real estate investors in Pennsylvania, allowing them to qualify for loans based on the rental income potential of the property rather than personal income.
These loans use the Debt Service Coverage Ratio (DSCR)—a calculation comparing rental income to property expenses to determine eligibility and loan amounts.
In Pennsylvania, where rental demand is strong, DSCR loans are commonly used to finance long-term rental properties, short-term vacation rentals, and multi-unit buildings.
For those following the BRRRR investing strategy, DSCR loans are ideal for refinancing after stabilizing a property. This strategy allows investors to build a portfolio of rental properties while preserving capital for future projects.
If you're considering investing in Airbnb rentals, DSCR loans can also help finance short-term rentals in Florida’s high-demand vacation markets. Learn more in our guide: Financing Airbnb Rentals with DSCR Loans.
To understand how to calculate DSCR and determine your eligibility, visit the How to Calculate DSCR section of this page.
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DSCR loans are a powerful financing tool for real estate investors in Pennsylvania, allowing them to qualify for loans based on the rental income potential of the property rather than personal income.
These loans use the Debt Service Coverage Ratio (DSCR)—a calculation comparing rental income to property expenses to determine eligibility and loan amounts.
In Pennsylvania, where rental demand is strong, DSCR loans are commonly used to finance long-term rental properties, short-term vacation rentals, and multi-unit buildings.
For those following the BRRRR investing strategy, DSCR loans are ideal for refinancing after stabilizing a property. This strategy allows investors to build a portfolio of rental properties while preserving capital for future projects.
If you're considering investing in Airbnb rentals, DSCR loans can also help finance short-term rentals in Pennsylvania’s high-demand business markets. Learn more in our guide: Financing Airbnb Rentals with DSCR Loans.
To understand how to calculate DSCR and determine your eligibility, visit the How to Calculate DSCR section of this page.
Pennsylvania DSCR Loan Products
Low Rates, from 1.0% Origination for long term & short term rentals in Pennsylvania.
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Long Term Rental
DCSR Loans Pennsylvania
Rates from 6.75%
LTV Up To 80%
From 1.0% Origination Points
Minimum DSCR: 1.0
Closing Time 14 Days
Appraisal Required
Minimum Credit Score: 660
Property Condition C4 Required
Purchase, Refinance, and Cash Out Available
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Short Term Rental
DCSR Loans Pennsylvania
Rates from 6.95%
LTV Up To 80%
1-2% Origination Points
Minimum DSCR: 1.0
Closing Time 21 Days
Appraisal Required & AirDNA Check
Minimum Credit Score: 680
Property Condition C4 Required
Purchase, Refinance, Cash Out Available
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How To Determine DSCR For Pennsylvania Rental Properties?
The Debt Service Coverage Ratio (DSCR) is calculated by dividing the monthly rent of the property by the monthly loan payment (principal + Interest), taxes, insurance and association fees (PITIA).
DSCR = Rent/PITIA
The basis of a DSCR loan in Pennsylvania, is that the rent you collect from tenants leasing the property should be greater than the cost to own and operate the property.
Investment purpose rental properties with a DSCR greater than 1.0 are called “cash flowing”. You can calculate the DSCR of your rental property with our DSCR Loan Calculator.
(DSCR Evaluation)
Property Value: $474,000
Loan: $379,200
Interest Rate: 7.25%
Ammortization: 30 YR (FRM)
Monthly Rent: $3,995
P&I Payment: $2,586.81
Monthly Taxes: $400.00
Monthly Insurance: $180
Monthly HOA: $0
DSCR 1.26
Pennsylvania DScr Loan process
Ridge Street closes Pennsylvania DSCR loans in 14-21 days.
Apply Or Get Pre-Approved Online
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Receive your term sheet
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Submit Docs
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Appraisal or BPO
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Closing
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When To Use a DSCR Loan?
DSCR loans are used by investors to "hold" real estate. These loans are long term and amortizing. This allows investors to continuously gain equity in their property while generating monthly cashflow.
Investors either use DSCR loans when purchasing a property or when refinancing it. The BRRRR Investing Strategy is popular among investors in which the DSCR loan is used to "cash out" the property.
Benefits Of DSCR LoanS Compared To Other Loan Types
Other benefits of DSCR loans include:
- No income verification
- Can be used for long term and short term rentals (Financing Airbnb's for example)
- Cost Effective
Best Rental Markets In Pennsylvania For DSCR Loans
Pennsylvania presents a unique blend of rental investment opportunities, driven by its diverse economy, affordable property prices, and strong demand in both urban and suburban markets. From the bustling cityscape of Philadelphia to the growing appeal of college towns and historic hubs, the Keystone State offers options for a wide range of investment strategies. DSCR loans provide investors the ability to tap into rental income for financing, making it easier to scale portfolios. This guide highlights Pennsylvania's top rental markets and their potential for DSCR-funded investments, offering opportunities for steady cash flow and long-term appreciation.
Philadelphia
Philadelphia’s rental market is a prime destination for investors, offering a mix of affordability, high rental demand, and long-term growth potential. As a city rich in history and culture, Philadelphia attracts a diverse tenant base, including students, young professionals, and families. Thriving industries like healthcare, education, and finance drive steady job growth, fueling demand for rental housing. Neighborhoods like Fishtown and University City are experiencing revitalization, presenting opportunities for value-add investments. With DSCR loans, investors can acquire cash-flowing properties in a market that combines stability with strong returns.
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Pittsburgh
Pittsburgh’s rental property market stands out for its affordability, steady rental demand, and economic resilience. Known as a hub for healthcare, education, and tech innovation, the city attracts a reliable mix of students, professionals, and families seeking quality rental homes. Neighborhoods like Lawrenceville and the South Side are hotspots for investment, offering opportunities to acquire and enhance properties in high-demand areas. With DSCR loans, investors can take advantage of Pittsburgh’s lower entry costs and consistent rental income potential to build a profitable portfolio in this steadily appreciating market.
Pennsylvania DSCR Loan FAQ’s
How can I Improve the DSCR of my property?
- Increase Your Down Payment. By Increasing your down payment your loan amount will go down and your DSCR will increase. If you’re struggling to improve your DSCR past 1.0, increasing your down payment is an option you may have to consider.
- Ask Your Lender About A Rate Buy Down. Some lenders, including Ridge Street, allow you to pay an additional fee at closing in exchange for a lower rate. In some cases, a rate buydown will allow you lower your DSCR without increasing your overall cash required to close.
- Push For Less Expensive Insurance. Ask your insurance broker if there is anything they can do to lower your policy fee. A lower insurance policy fee will increase your DSCR.
Could I use a DSCR loan if I have to renovate a property?
You can start by getting a short term fix and flip loan to renovate the property and then refinance the property with a DSCR loan. The strategy of buy, rehab, rent, refinance, and repeating is called The BRRRR Strategy.
Can I use a DSCR loan on a Vacation property?
Absolutely! This is one of the main use cases for a DSCR loan.
What loan amounts can I get for a DSCR loan?
Between $50K and $2M. As long as a the DSCR is greater than 1.0, Ridge Street will lend on it.
Are DSCR loans only for investment properties?
Yes. If you are buying a piece of real estate which you intend to live in, then you would not qualify for a DSCR loan.
For refinances and cash outs, does the property have to be rented?
The short answer is no. We understand that investors who fix and refinance properties intend to refinance as soon as possible after renovating a property.
This said, providing a DSCR loan on a rental property that is not rented is higher risk. We'll want to see that the market you are in is very "rentable" at the market rent for your property. We will not provide a DSCR loan on a rental property that has been listed for rent for 3 months with no bites, for example.
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How to Get A DSCR Loan In Pennsylvania with Ridge Street?
Ridge Street is the #1 DSCR Rental Property Lender in Pennsylvania. We pride ourselves on fast closings and fairly priced loans. Get approved for your next project today.
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