A HELO-DSCR is a fixed lump-sum 2nd mortgage on your investment property that qualifies on the rent, not your tax returns. Leave your current first-mortgage rate alone and put your equity into your next deal.
2-minute survey · No credit pull to start · 2nd mortgages are subject to LTV and guideline restrictions
Traditional home equity loans want W-2s and tax returns. A HELO-DSCR looks at the property instead: does the rent cover the total monthly housing cost, including your first mortgage and the new 2nd? That ratio is the DSCR (debt service coverage ratio).
You get one lump sum at closing on a 2nd lien. Your first mortgage, and its rate, stays exactly where it is.
Use the funds for your next down payment, a rehab, paying off higher-cost debt, or reserves for your portfolio.
Hypothetical figures to show the math. Not a quote. Minimum DSCR, loan amount and terms vary by program and are subject to underwriting.
If your rentals have equity and your first-mortgage rate is worth keeping, a HELO-DSCR may be the cleanest way to put that equity to work.
Keep the first mortgage you locked when rates were lower. Borrow against equity with a separate 2nd.
Write-offs shrink taxable income. DSCR qualifying looks at the property's rent instead.
Pull equity from one rental to fund the down payment on the next, without touching your first lien.
LLC vesting is allowed on many programs, so you can keep your investments in your entity.
Fund renovations that raise rent and value, with one fixed lump sum at closing.
Single-family, townhomes, condos and 2–4 unit rentals can qualify.
We shop all three for your scenario and show you the numbers side by side.
| HELO-DSCR | DSCR Cash-Out Refi | Investment HELOC | |
|---|---|---|---|
| Your first mortgage | Stays in place | Replaced with a new loan | Stays in place |
| How you get funds | One lump sum at closing | Lump sum at closing | Draw as needed |
| Rate structure | Typically fixed | Fixed or adjustable | Typically variable |
| Qualifies on | Property rent (DSCR) | Property rent (DSCR) | Varies by program |
| Often best when | Your first-lien rate is worth keeping | Your current rate is high or you need more leverage | You want flexible access over time |
2nd mortgages are available, but are subject to LTV and guideline restrictions. Maximum CLTV, loan amount, minimum DSCR, credit score, reserves, property type and state availability vary by program and lender. Not every property or borrower will qualify.
Two minutes, no credit pull. Tell us about the property, the rent and how much you need.
We compare HELO-DSCR, DSCR cash-out and HELOC options across our wholesale lenders.
A licensed loan officer walks you through the numbers, then we take your file to closing.
A HELO-DSCR is a closed-end home equity loan (a 2nd mortgage) on an investment property that qualifies on the property's rental income instead of your personal income. You receive one lump sum at closing and your existing first mortgage stays in place.
No personal income documents are required on DSCR programs. Qualification is based mainly on the property's rent compared to its total housing expense, including both the first mortgage and the new 2nd. Credit, reserves and the property itself are still reviewed.
Loan amounts run from $50,000 up to $1,000,000, with combined loan-to-value (first mortgage plus the new 2nd) up to 75% on investment properties. Your final amount depends on value, rent, credit and program guidelines.
The minimum credit score is 620. Higher scores can open more leverage and better pricing.
Yes. LLC vesting is allowed on many HELO-DSCR programs.
A cash-out refinance replaces your first mortgage. If your current rate is lower than today's rates, a HELO-DSCR lets you keep it and borrow against your equity with a separate 2nd mortgage. We compare both so you can see the numbers side by side.
Single-family homes, townhomes, PUDs, condos (including many non-warrantable condos) and 2–4 unit rentals. Short-term rentals may be considered on select programs.
No. 2nd mortgages are available, but are subject to LTV and guideline restrictions. Every file is subject to credit approval, appraisal or valuation, and program guidelines.