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DSCR Loan Florida
Last updated: April 16, 2024
DSCR loans are popular among Florida rental property investors because they do not require income verification or tax returns and are therefore faster and easier than conventional loans and bank loans. Whether your strategy is long term rentals (LTR), or short term rentals (STR), if you're looking for the best DSCR loan Florida has to offer, you've come to the right place.
We are seeing a lot of DSCR loan requests for purchase and refi transactions in Florida where the appraisal market rent does not support a high LTV because As Is values in Florida have risen faster than 12 month rents -- the cash flow (DSCR) based on the appraisal market rent may not cover the monthly payment for your target loan amount. That's why we now offer a no minimum DSCR option -- that's right, it sounds crazy but it is true, the DSCR can be very low and we will fund 70% LTV!
We're also seeing a lot of investors unsure if they want to use a long term rental strategy (i.e. 12 month lease) or a short term rental strategy (i.e. Airbnb). Not to worry! Many of our clients have a mixed portfolio of LTR and STR -- optionality is important when optimizing cash flow across your portfolio.
In today's elevated interest rate environment, it's important that you work with a DSCR lender that understands how to structure your DSCR loan so that you can achieve your specific goals. Whether that's optimizing loan amount, increasing monthly cash flow, or both. Our DSCR loan program, backed by our team of experienced rental investors gives you all-important optionality to confidently grow your portfolio in the sunshine state.
Florida DSCR loan interest rates
Source: DSCR Loan Interest Rates Index
Getting a DSCR loan for an individual rental property or portfolio has never been easier. Get the lowest rate, highest leverage, lowest fees, and fastest processing every time from OfferMarket.
Here's how OfferMarket compares to other DSCR lenders in Florida:
| OfferMarket | Other DSCR Lenders | |
|---|---|---|
| Interest Rate | Get Instant Quote | Get Instant Quote |
| LTV Purchase | 80% | 75% |
| LTV Rate and Term Refi | 80% | 75% |
| LTV Cash Out Refi | 75% | 70% |
| Minimum DSCR | 1.1 | 1.2 |
| Minimum Credit Score | 660 | 680 |
| Borrower Experience | 0+ | 1+ |
| Appraisal | Direct (save $250) | AMC (waste $250) |
| Seasoning | None | 6 Months |
| Origination Fee | 0.75% to 1% | 2% to 3% |
| Junk Fees | None | Tons |
| Time To Close | 15 - 25 Days | 30 - 60 Days |
| Quoting | Instant | Slow |
| Pre-Approval Letter | Instant | Slow |
| Processing | Online, Fast | Manual, Slow |
| STR | Yes | No |
DSCR Loan Florida Requirements
Our requirements for Florida DSCR loans are based on common sense lending guidelines. Is a DSCR loan a good fit for you?
| DSCR Loan Program Guidelines | |
|---|---|
| Minimum Credit Score |
660 (mid score on tri merge) |
| Background | Clean |
| Immigration Status | US Citizen, Green Card Holder, Foreign National |
| Borrowing Entity | LLC or Corporation |
| Personal Guarantee |
|
| Min DSCR |
|
| Borrowing Entity | LLC or Corporation |
| As Is Value | Single Prorperty: $100,000+, Portfolio: $62,500+ |
| Appraisal |
|
| Appraisal Review | ClearCapital CDA |
| Occupancy |
|
| Down Payment | 20% (80% LTV) |
| Experience | Not required |
| Bank Statements | 3 Months |
| Liquidity | Cash to close, 9 months mortgage payments |
| Zoning | Non-Rural |
DSCR Loan Florida Rates
There are several factors that determine interest rates for DSCR loans:
💳 Credit score
The higher your credit score, the lower your interest rate. Most Florida DSCR lenders will use a Tri Merge Credit Report which is a hard inquiry from all three credit bureaus. The lender ignores the highest and lowest scores and uses the middle score as their input to price your DSCR loan.
| Credit Score | Interest Rate |
|---|---|
| 760+ | +0.0% |
| 740 - 759 | +0.05% |
| 720 - 739 | +0.1% |
| 700 - 719 | +0.15% |
| 680 - 699 | +0.25% |
| 660 - 679 | +0.50% |
Did you know that your credit score also impacts your LTV?
| Credit Score | LTV (purchase) | LTV (cash out refi) |
|---|---|---|
| 720+ | 80% | 75% |
| 700 - 719 | 75% | 70% |
| 680 - 699 | 70% | 65% |
| 660 - 679 | 65% | 65% |
To make sure you have the best possible interest rate and LTV, we recommend always keeping your credit score above 720.
💰 Loan amount
The lower your loan amount, the higher your interest rate. Small loans generate lower interest income for lenders, so most lenders will want a slightly higher interest rate to increase the interest income. Low loan amounts are less common in Florida given home price appreciation which is driven by strong demand from rental property investors, vacation rental investors and snowbirds.
| Loan Amount | Interest Rate |
|---|---|
| $150,000+ | +0.0% |
| $125,000 - $150,000 | +0.1% |
| $100,000 - $125,000 | +0.2% |
| $75,000 - $100,000 | +0.3% |
| $50,000 - $75,000 | +0.4% |
| Under $50,000 | +0.5% |
📊 LTV
The lower your loan-to-value (LTV), the lower your default risk. Accordingly, the lower your LTV, the lower your interest rate. This is because lower LTV means you you have more equity in the deal and a lower payment, which makes you better able to handle shocks including home price decline, non-paying tenants, and unexpected maintenance.
| LTV | Interest Rate |
|---|---|
| 80 | +0.4% |
| 75 | +0.3% |
| 70 | +0.2% |
| 65 | +0.1% |
| 60 | +0.0% |
| Under 60 | +0.0% |
🏘️ Property type
Believe it or not, your interest rate will vary slightly depending on the type of property. A single family residence generally has the lowest interest rate while condos, duplexes, triplexes, quadplexes and 5+ unit multifamily will carry a slight risk premium.
🏠 Rental investing experience
Some DSCR lenders require at least 1 rental property, while other lenders like OfferMarket work with first time investors with 0 verifiable experience. In certain cases, your interest rate will be progressively lower as your experience increases. A proven track record of rental property investing and rental property management is directly correlated with lower default risk and we reward you with lower interest rates as your portfolio grows.
💸 Prepayment Penalty
A prepayment penalty for DSCR loans is common. This is a fee charged if you pay off your loan within a specific period of time. Most prepayment penalties are "stepdown" meaning the penalty charged as a percentage of your principal loan balance declines over the duration of the prepayment penalty period. The most common pre-payment penalty options are 3-2-1 and 5-4-3-2-1. Florida real estate investors tend to be attracted to lower prepayment penalty options because of home price appreciation and the temptation to sell. Further, Florida rental investors using a STR (Airbnb, VRBO) strategy should consider low and no prepayment penalty options due to market volatility -- the the property ends up generating negative cash flow, it's ideal to be able to sell without a penalty. OfferMarket now offers the following prepayment penalty options with the most competitive terms in the industry at each option:
- 5 Year (5-4-3-2-1-0)
- 3 Year (3-2-1-0)
- 2 Year (2-1-0)
- 1 Year (1-0)
- No Prepayment penalty (0)
Watch the video below to learn more about prepayment penalties. The higher the prepayment penalty, the lower the interest rate.
Current Florida DSCR Loan Interest Rates
For up-to-date DSCR loan Florida interest rates, OfferMarket is the first and only company that publishes an index so you can track real-time rates and trends.
DSCR Loan Florida Down Payment
As long as your rental property's DSCR is 1.1 or higher at 80% LTV, and your credit score is
DSCR Loan Florida
The best DSCR loan Florida has to offer is right here at OfferMarket. Our mission is to help you build wealth through real estate. We do this by eliminating unnecessary costs, using technology to make sure the most competitive capital provider on our platform is lined up to buy your loan from us, and passing on the savings to you. When you get a quote from OfferMarket, you always get our best offer. With OfferMarket as your DSCR lender, you can finally focus on investing in real estate and growing your rental portfolio.
📉 Lower interest rates
💰 Higher LTV
🛎️ Better service
👨💻 Better technology
⚡ Faster time to close
📅 No seasoning
DSCR Loan Florida Markets
We think you're smart for building a rental property portfolio in Florida, and we'd like to be your lender. We like lending in Florida, you can say we're bullish on the long term prospects for rental property investing in the Sunshine State.
Some of the Florida markets we find attractive for long term and short term rental investors:
| County | Cities |
|---|---|
| Broward County | Fort Lauderdale, Pompano Beach, Hollywood, Coral Springs, Plantation, Pembroke Pines, Davie, Miramar, Deerfield Beach, Weston, Sunrise, Coconut Creek, Tamarac, Margate, Parkland, Lauderhill |
| Pinellas County | St Petersburg, St Pete Beach, Gulfport, Clearwater, Largo, Pinellas Park, Dunedin, Seminole, Tarpon Springs, Safety Harbor, Oldsmar, Madeira Beach, Indian Rocks Beach, Treasure Island, Belleair, Tierra Verde, Indian Shores, Reddington Beach, North Reddington Beach, Reddington Shores, East Lake, Belleair Bluffs, Feather Sound, South Pasadena, Bay Pines, Bardmoor, Feather Sound, Harbor Bluffs, Ridgecrest, Bear Creek |
| Hillsborough County | Tampa, Riverview, Brandon, Plant City, Ruskin, Valrico, Temple Terrace, Seffner, Wimauma, Sun City Center, Greater Carrollwood, Dover, Gibsonton, Thonotosassa, Town 'n' Country, Westchase, Citrus Park, Keystone, Greater Northdale, Progress Village |
| Palm Beach County | Palm Beach, West Palm Beach, Boca Raton, Delray Beach, Palm Beach Gardens, Lake Worth, Boynton Beach, Jupiter, Wellington, Palm Springs, Royal Palm Beach, North Palm Beach, Riviera Beach, Greenacres, Juno Beach, Lantana, Belle Glade, Westlake, Tequesta, Lake Park, South Palm beach, Palm beach Shores, Atlantis, Pahokee, Highland Beach, Manalapan, Ocean Ridge |
| Miami-Dade County | Miami, Doral, Miami Gardens, North Miami, Aventura, Miami Lakes, South Miami, North Miami Beach, Coral Gables, Homestead, Hialeah, El Portal, Kendall, Cutler Bay, Pinecrest, Palmetto Bay, Opa-locka, Surfside, Sunny Isles Beach, Key Biscayne, Florida City, Miami Springs, Sweetwater, Miami Shores, West Miami, Bal Harbour, North Bay Village, Medley, Bay Harbor islands, Westchester |
| Manatee County | Bradenton, Palmetto, Lakewood Ranch, Ellenton, Anna Maria, Holmes Beach, Cortez, West Bradenton, Bayshore Gardens, South Bradenton, Samoset, Whitfield, West Samoset, Memphis |
| Sarasota County | Sarasota, Sarasota Springs, South Sarasota, North Sarasota, Venice, South Venice, Venice Gardens, Plantation, Siesta Key, North Port, Nokomis, Gulf Gate Estates, The Meadows, Bee Ridge, Osprey, Fruitville, Southgate, South Gate Ridge, Warm Mineral Springs, Vamo, Laurel, Kensington Park, Ridge Wood Heights, Desoto Lakes |
| Lee County | Fort Myers, Cape Coral, Bonita Springs, Lehigh Acres, Estero, Sanibel, Fort Myers Beach, Alva, Matlacha, North Fort Myers, Captiva, Saint James City, Burnt Shore Marina, Iona, San Carlos Park, Bokeelia, Cypress Lake, Gateway, Three Oaks, Buckingham, Pine Manor, Suncoast Estates, Palmona Park, Tice, Pine Island Center, Whiskey Creek, Page Park |
| Lake County | Clermont, Leesburg, Eustis, Tavares, Mount Dora, Minneola, Lady Lake, Groveland, Umatilla, Fruitland Park, Sorrento, Mascotte, Montverde, Howey-in-the-Hills, Astor, Grand Island, Astatula, Altoona, Paisley, Okahumpka, Ferndale, Lisbon, Pine Lakes |
| Orange County | Orlando, Apopka, Winter Park, Winder Garden, Ocoee, Windermere, Maitland, Gotha, Pine Hills, Doctor Phillips, Horizon West, Hunters Creek, Lake Buena Vista, Kissimmee |
| Brevard County | Melbourne, Palm Bay, Cape Canaveral, Cocoa Cocoa Beach, Malabar, Melbourne Beach, Merritt Island, Mims, Rockledge, Satellite Beach, Scottsmoor, Sebastian, Sharpes Titusville |
| Osceola County | Kissimmee, St. Cloud, Yeehaw Junction, Buena Ventura Lakes, Intercession City, Celebration, Poinciana |
| Volusia County | Daytona Beach, South Daytona, Daytona Beach Shores, DeLand, New Smyrna Beach, Deltona, Ormond Beach, Port Orange, Orange City, DeBary, Edgewater, Holly Hill, Le Leon Springs, Ponce Inlet, Oak Hill, Lake Helen, Pierson, Ormond-by-the-Sea, Glencoe, West De Land, North De Land, De Land Southwest |
| Escambia County | West Pensacola, Cantonment, Molino, Century, Warrington, Ferry Pass, Ensley, Bellview, Myrtle Grove, Gonzalez, Brent, Goulding |
| Okaloosa County | Destin, Crestview, Fort Walton Beach, Niceview, Shalimar, Mary Esther, Baker, Laurel Hill, Valparaiso, Cinco Bayou, Ocean City, Wright, Lake Lorraine |
| Collier County | Naples, Marco Island, Immokalee, Golden Gate, Everglades City, Lely, Lely Resort, Chokoloskee, Goodland, Naples Manor, Orangetree, Vineyards, Verona Walk, Plantation Island |
| Duval County | Jacksonville, Jacksonville, Beach, Atlantic Beach, Neptune Beach, Baldwin |
| Leon County | Tallahassee, Woodville, Fort Braden |
| Alachua County | Gainesville, Alachua, High Springs, Newberry, Hawthorne, Archer |
| Polk County | Lakeland, Winter Haven, Bartow, Davenport, Haines City, Lake Wales, Auburndale, Polk City, Mulberry, Frostproof, Lake Alfred, Fort Meade, Dundee, Eagle Lake, Lake Hamilton, Highland City |
| Bay County | Panama City |
DSCR Loan For Airbnb
We offer DSCR loans for your Florida short term rental (STR). It's important to note that short term rental loans will commonly carry a higher interest rate, higher origination fee, and slightly lower LTV than DSCR loans for rental properties that are leased for 12 month terms.
Florida is a great market for short term rentals, especially with demand from sites like Airbnb and VRBO. To determine your LTV, our short term rental program underwriter will take 80% of the Airdna Rentalizer rent estimate as the input for your DSCR. Depending on market volatility, we may require slightly higher DSCR (1.2) than our long term rental program (1.1).
DSCR Loan Pre Approval
Submit your loan application today for an instant quote and pre-approval. Once you submit your DSCR loan application, you will have the ability to download your pre-approval letter and schedule a call with your relationship manager to review your request and confirm your terms.
You're less than an minute away from your DSCR loan quote and pre-approval letter. Getting the best DSCR loan Florida has to offer has never been easier!
