Can I get a DSCR loan with less than 20% down?

Potentially, yes—if the property's DSCR is strong (1.5+) and you have good credit. LYNK Mortgage offers LTV up to 80%, which is equivalent to 20% down. Some loans go higher with stronger financials, but 20% is the standard floor.

Does my down payment reduce the interest rate?

Larger down payments typically result in slightly better rates because the lender has more equity cushion. A 25% down payment might get you 0.25-0.50% lower rate than 20% down, depending on current market conditions and your credit profile.

Is the down payment different for furnished vs. unfurnished rentals?

Furnished short-term rentals (like Airbnb) may have different LTV limits than unfurnished long-term rentals. STR loans sometimes require 25%+ down due to income volatility, while traditional rentals may allow 20% at strong DSCR ratios.

Can seller credits count toward my down payment?

Yes—seller concessions typically can be used toward closing costs and down payment, though lenders limit them to 2-3% of purchase price in most cases. This effectively reduces your out-of-pocket capital needed.

DSCR Loan Down Payment: How Much You Need in 2026

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Quick Facts

Typical Down Payment

20-25%

LYNK Mortgage Max LTV

80%

Tax Returns Required

Loan Term

Up to 30 years

Min Credit Score

620+

Most DSCR loan down payments range from 20-25% of the purchase price, though this varies by lender and loan structure. LYNK Mortgage offers loans up to 80% LTV, meaning you can put down as little as 20% and finance the rest. Your specific down payment depends on the property's debt service coverage ratio, credit profile, and desired loan amount.

How DSCR Down Payment Works

DSCR lenders determine down payment requirements by calculating Loan-to-Value (LTV), which expresses the loan amount as a percentage of the property's value. If a property appraises at $500,000 and you get an 80% LTV loan, you borrow $400,000 and put down $100,000 (20%). The property's ability to service debt is more important than your personal income, so lenders focus on whether rental income covers the mortgage payment, taxes, insurance, and HOA fees. Down payment amounts can flex based on how strong the DSCR ratio is—properties with 1.5+ DSCR ratios may qualify with less down than those at 0.85 DSCR.

Factors That Affect Your Down Payment Amount

Several variables influence how much you'll need to put down. A lower DSCR ratio (closer to breakeven) typically requires a higher down payment to offset risk. Your credit score matters too—borrowers with 680+ credit usually qualify for better LTV terms than those with 620-660 scores. The property type affects requirements; single-family rentals usually get better terms than commercial or mixed-use properties. Interest rates also play a role; when rates are higher, lenders may require more equity as a buffer. LYNK Mortgage evaluates each deal individually, considering the market, property condition, and your investment experience.

Down Payment and Closing Costs Are Different

Your down payment covers the equity stake in the property, but you'll also have closing costs—typically 2-5% of the loan amount. If you're buying a $500,000 property with 20% down and 3% closing costs, you need $100,000 down plus ~$12,000 in closing costs (on the $400,000 loan). Some investors negotiate seller credits to cover closing costs, or they add closing costs to the loan amount if the property's value and DSCR support it. Planning for both expenses upfront prevents surprises at closing.

Strategies to Lower Your Down Payment

If 20% down feels too high, consider a few strategies. Portfolio-level underwriting uses multiple properties to strengthen your overall DSCR profile, potentially allowing lower down on new purchases. Obtaining seller credits toward closing costs frees up capital to put toward down payment. If the property has strong cash flow, some lenders allow slightly higher LTV (up to 85% in certain cases) if DSCR is above 1.25. Working with an experienced private lender like LYNK Mortgage who understands portfolio strength and long-term investor relationships can unlock more flexible terms than traditional banks or conventional lenders offer.

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LYNK Mortgage offers fix & flip loans, new construction loans, multi-family bridge loans, and DSCR rental loans to real estate investors.

Disclaimers: LYNK Mortgage makes loans solely for business purposes (and not for personal or consumer use) and is exempt from licensing in all states in which it operates. LYNK Mortgage does not lend on owner-occupied properties. Listed rates, terms, and conditions are offered only to qualified borrowers, may vary by loan product, deal structure, property state, or other applicable considerations, and are subject to change at any time without notice. No information on this site is intended to, or shall, create a legally binding commitment or obligation on the part of LYNK Mortgage and all terms are expressly subject to LYNK Mortgage's credit, legal, and investment approval process.

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