The Quick Read: A DSCR refinance replaces an existing investor mortgage using the property’s rent, not the owner’s paycheck, as the main test. The loan is reviewed primarily on property-level rental income covering the payment, subject to lender guidelines. Two numbers drive the file: appraised value sets leverage, and rent sets coverage. Miami’s high prices and heavy condo stock make both numbers harder to clear.
Key Takeaways
- Value sets the LTV. Rent sets the DSCR. A refinance has to pass both tests.
- Cash-out tops out around 75% LTV across most of the network, with about 6 months of seasoning as the common expectation.
- Clearing 1.00 coverage is not the same as positive cash flow.
- Miami condos add a third test: the building itself.
- Sub-1.00 coverage is available through select lenders in the network, with leverage and terms adjusted.
- These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
What Is a DSCR Refinance?
It is a non-QM investor refinance. The lender compares monthly rent to the full housing payment, PITIA: principal, interest, taxes, insurance, and any HOA dues. No personal debt-to-income calculation drives the decision.
DSCR Calculator
Run the numbers in your market
Rate source: Freddie Mac 30-yr average via FRED® — Federal Reserve Bank of St. Louis · effective Sep 24, 2026
Prefilled with starting assumptions — enter your own rent or nightly figures, taxes, insurance, and HOA for a more accurate picture.
Program parameters update from Lendmire’s centralized guideline source. Taxes and insurance are editable estimates.
As of Sep 24, 2026 · General Freddie Mac market benchmark, not a Lendmire loan offer. Rent, nightly rate, occupancy, taxes, and insurance are editable estimates. Short-term rental figures are estimates only and vary significantly by season, property type, management approach, and local short-term-rental rules — confirm local regulations before relying on them. Qualifying income for short-term rentals varies by program — some use appraisal market rent, others use documented STR history or projections — and is confirmed in underwriting. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
Commercial lenders use a different formula, net operating income over annual debt service. Residential DSCR does not. Gross monthly rent divided by PITIA is the whole calculation.
DSCR loans are designed for non-owner-occupied investment properties. Because they are business-purpose investor loans, they are reviewed differently from a standard owner-occupied mortgage. The complete DSCR loans guide covers the fundamentals. This article stays on the refinance side.
How Does Underwriting Treat a Refinance, Step by Step?
Across a wholesale network of DSCR lenders, the sequence is consistent even when the overlays differ.
1. Define the purpose. Rate-and-term, cash-out, and a delayed-financing purchase are treated differently on seasoning.
2. Build the payment. Add the new principal and interest, taxes divided by twelve, hazard insurance, flood or wind coverage where required, and HOA dues. Investor-owned rentals get no homestead exemption in Florida, so taxes go in at full assessed levels.
3. Pick the rent figure. Most programs use the lower of the signed lease or the appraiser’s market rent. An above-market lease does not raise rent used for lender review.
4. Order the appraisal. One report delivers value and market rent. For single-family and condo units, the rent comes from Form 1007, the comparable rent schedule. Two-to-four unit properties use the 1025 income form. Rent determination ultimately belongs to the lender, not the appraiser.
5. Compute the ratio. Rent divided by PITIA. At 1.00, rent equals the payment on paper. Below it, rent falls short.
6. Size the loan. The LTV cap applies to value. If coverage is thin, the levers are a lower loan amount, a longer or interest-only structure, or a sub-1.00 program.
7. Assemble documents. Expect current mortgage statements, leases or a rent roll, bank statements, insurance declarations, and HOA or condo documents. LLC vesting adds entity documents, depending on program guidelines.
8. Review credit and reserves. These do not replace the property test, but they drive eligibility and leverage tiers.
What Leverage and Credit Does a Refinance Typically Need?
Cash-out refinances top out around 75% LTV across most of the network. Short-term-rental collateral is lower: cash-out at 70%, with refinances around 70% too. Rate-and-term files typically run into little or no seasoning wait.
Credit tiers start at a 620 floor in parts of the network. Most programs want around 660, and 700 or higher unlocks the strongest leverage. Loan sizes run up to $3,000,000 on standard programs, and above $2,500,000 the network generally holds to 30-year fixed structures. Reserves commonly run about 6 months of PITIA, stepping up to about 9 months on loans above $1,500,000. Conservative rate-and-term files at modest leverage below $1,500,000 can see reserves waived. All of this varies by lender, borrower, and property, and none of it is a commitment to lend.
Coverage matters here too. A 1.00 ratio is where select programs start, not a universal standard. Stronger ratios open better pricing and leverage.
Seasoning: When Does the Value Count?
Seasoning is a lender overlay, not a federal rule, on DSCR loans. The clock runs from the recorded ownership date, not from rehab completion or lease signing. For cash-out, about 6 months is the common expectation.
Inside the seasoning window, the loan is typically sized off documented cost basis: purchase price plus eligible costs and receipted improvements. A strong appraisal does not unlock extra cash early. A cash buyer may use delayed financing to skip the wait, but the value cap still applies.
Compare that with agency conventional cash-out rules, which are stricter and run on a different regime. Those rules do not govern DSCR files.
Why Miami Pressures the Math
Miami is a high-price market, and rents often cover a smaller share of the payment than in lower-priced metros. That is the core DSCR challenge here. Property taxes, insurance, and condo dues all sit in the denominator, so each one pulls the ratio down. Because insurance costs in Miami-Dade can shift from one property to the next, treat the insurance estimate as the first item to verify with a fresh quote.
A fair stress test uses three cases: a base case, a downside case with softer rent, and a severe case that includes a special assessment. If the file only works in the base case, expect trouble.
Run the numbers on a modeled single-family rental that appraises with rent clearing about 1.2x. A modest hit to market rent at appraisal, or a jump in insurance, can drag that toward 1.05x or lower. Those figures are modeled assumptions, not market data. The point is that thin cushions disappear.
The Condo Edge Case
Condos are where Miami refinances most often break. Building-level risk can change value, marketability, cash flow, and eligibility.
Florida now requires milestone inspections for buildings of three or more habitable stories. Once a building reaches 30 years, inspections recur on a 10-year cycle. Associations also must complete structural integrity reserve studies, and the Division of Condominiums tracks SIRS completion through an online account. Associations can fund reserves through special assessments, lines of credit, or loans with owner approval.
What that means for a lender file: reserves and special assessments need to be read together. A well-reserved building with no assessment looks very different from one planning a large call. Insurance information should be in hand early, not at the last minute.
Warrantability is the next hurdle. High investor concentration, litigation, or thin reserves can make a building non-warrantable for agency purposes. That ends conventional financing, but it does not automatically end DSCR. Some programs consider such buildings, others do not, so lender selection matters more than usual. The Form 1007 can be used for condos, but it is only a form reference. DSCR loans are not agency products.
Structures and Variations
Sub-1.00 coverage. Available through select lenders in the network, with leverage and terms adjusted. Expect lower leverage, stronger credit, and more reserves. A rent shortfall discovered at appraisal can also kill the deal or force more cash in.
No-ratio. Available only through select lenders, generally for borrowers who already own a primary residence.
Interest-only and extended terms. A lower payment raises the ratio, because the formula is rent over PITIA. The spine is the 30-year fixed, with extended terms such as 40-year and interest-only periods available through select lenders. ARM structures exist for investors who want them.
Short-term rentals. Income does not fit the 1007’s monthly format, so lenders decide separately whether and how to count it. Expect a 640+ score, about 12 months of hosting history, and a 1.00 coverage floor on refinances. Short-term rental rules can vary by city, county, HOA, and property type, so investors should confirm local rules before relying on projected rental income.
DSCR vs. conventional financing
There are two common ways to finance an investment property in this market, and they qualify you differently — here’s how investors weigh them.
Why investors choose it
- Qualifies on the property’s rental income — no personal tax returns, W-2s, or pay stubs needed to document income.
- No personal debt-to-income ceiling to clear, so existing mortgages and obligations don’t cap your borrowing the same way.
- Can be closed in an LLC, keeping the property inside a business entity.
- Built for scaling — not held to the limit on number of financed properties that conventional financing applies.
- Underwriting centers on the deal: generally qualifies when the rent covers the payment, a 1.00x coverage ratio being a common baseline (confirmed in underwriting).
- Designed specifically for investment property, including long-term and, where the program allows, short-term rentals.
Where it’s strong
- Often the lowest ongoing financing cost for a buyer who fully qualifies on personal income — a fit for a first property or a cost-first purchase.
Trade-offs for investors
- Requires full personal income documentation and must fit within a debt-to-income limit — salary, existing debts, and other mortgages all count.
- Typically held in your personal name rather than a business entity.
- Caps how many financed properties you can carry, which can become a ceiling as a portfolio grows.
- Evaluates you as a borrower as much as the property, which usually means more paperwork.
How investors usually choose: a first or single property often optimizes for the lowest financing cost; portfolio builders often optimize for leverage, vesting in an LLC, and scaling past conventional caps. The right answer depends on your goals, the property, and current guidelines — both paths run through select lenders in Lendmire’s wholesale network, with eligibility and terms confirmed in underwriting.
Ineligible property types. Manufactured homes (single- and double-wide), log homes, and barndominiums are not offered in these programs.
Where the General Rule Breaks
- A high lease does not help. The lower of lease or market rent usually controls.
- A big appraisal does not mean big cash. Early in seasoning, cost basis can cap the loan.
- Clearing 1.00 is not positive cash flow. DSCR compares rent to PITIA only. Repairs, vacancy, management, utilities, and capex sit outside it.
- A bigger down payment helps, but only so far. It lowers the payment and can lift the ratio, but never erases leverage caps, credit floors, reserve rules, or property eligibility. The strongest files clear both tests: enough equity and enough rental coverage.
- Form changes are possible. A new appraisal format is reportedly retiring the standalone 1007 and 1025 for agency-delivered loans, which may touch appraiser panels used by non-QM lenders. This is not confirmed externally, so watch for how appraisal ordering evolves.
What Does the Investor Decision Look Like?
Consider an investor with a Miami duplex bought in cash and held through renovation. Seasoning, cost basis, and appraised value decide how much equity can come out. If the property is leased and rent clears 1.00 with some cushion, a cash-out near the 75% ceiling is plausible. If rent is thin, the choices are lower leverage, a longer or interest-only structure, or a sub-1.00 program with adjusted terms.
Picture a different investor, holding a hard-money or bridge loan on a stabilized property. A DSCR refinance can pay it off into permanent debt, usually without a seasoning wait on a rate-and-term basis. For this investor the question is mostly coverage and value, not cash out.
Now say the investor owns a condo in an older building. The honest question is whether the building survives lender review before the numbers even matter. If it does not, the stronger play may be a different property with cleaner building-level facts. That is a signal about asset selection, not a loan-type problem.
The flip point: if an investor has strong traditional employment income, one rental, and a warrantable condo or house, conventional financing may cost less and avoid non-QM friction. DSCR becomes the more practical path for entity-owned portfolios, self-employed borrowers, or files where property income is the cleaner basis. This is a genuine toss-up for many single-property owners.
Lendmire, a DSCR-focused mortgage broker, arranges these refinances through select lenders across 40 states plus Washington, D.C. For deeper reading, Lendmire has guides on how to cash-out refinance investment properties in Florida and on cash-out refinances for investment properties more broadly.
Tax treatment can depend on how the funds are used and how the property is held; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Key Terms Defined
PITIA: Principal, interest, taxes, insurance, and association dues, the full monthly housing obligation.
DSCR: Monthly rent divided by PITIA, a measure of whether rent covers the payment.
Seasoning: The ownership period a lender requires before it sizes a loan off new appraised value.
Cost basis: Purchase price plus eligible costs and documented improvements.
SIRS: Structural integrity reserve study, a Florida condo requirement that assesses building reserves.
Form 1007: The appraiser’s comparable rent schedule for single-family and condo investment properties.
Frequently Asked Questions
Can a Miami condo qualify for a DSCR refinance?
Often yes, but the building gets reviewed along with the unit. Reserves, special assessments, investor concentration, litigation, and insurance all matter. A building that is non-warrantable for conventional loans may still be considered by some DSCR programs. Eligibility depends on the lender.
How much cash can I take out?
Cash-out tops out around 75% LTV across most of the network, and 70% on short-term-rental collateral. Early in seasoning, programs typically size off cost basis instead of appraised value. Reserves, credit, and coverage all affect the final number.
Does a signed lease higher than market rent raise my ratio?
No. Most programs use the lower of the lease or the appraiser’s market rent. An above-market lease does not lift rent used for lender review.
Is a DSCR over 1.00 the same as positive cash flow?
No. DSCR compares rent to PITIA only. Vacancy, repairs, management, utilities, and capex are outside it, so a property can clear 1.00 and still lose money in practice.
What if my property rents below its payment?
Sub-1.00 coverage is available through select lenders in the network, with leverage and terms adjusted. You can also reduce the loan amount, add a longer or interest-only term, or reconsider the property. Each is subject to lender guidelines and credit review.
If you are buying or refinancing a rental property and want to see how the numbers work, Lendmire can help you compare DSCR loan options based on the property income, credit profile, leverage, and investor goals. Reach the team at 828-256-2183 or request a quote.
South Florida’s condo inspection and reserve cycle will keep reshaping which Miami buildings a lender will touch, so the smartest refinance prep starts with the association’s paperwork, not the rent roll.
About Lendmire
Lendmire (NMLS# 2371349) is a DSCR-focused mortgage broker that helps arrange investor financing across 41 markets, including Washington, D.C., through wholesale and investor-lending channels. DSCR eligibility is generally reviewed by the lender on the property’s rental income rather than personal income documentation, subject to lender guidelines — which works for self-employed investors, LLC operators, and portfolios above four financed properties. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
Get Started
Ready to find the right loan for you?
In about 30 seconds you can review financing options available for your investment property. No commitment required.
Informational only. Not a Loan Estimate, approval, or commitment to lend. Program availability and eligibility are subject to lender guidelines, credit approval, property review, and underwriting.
References
2. Florida Senate – HB 913 bill summary
3. Withum – Key Changes from Florida House Bill 913
4. Florida DBPR Division of Condominiums – Inspections
This article is part of Lendmire’s DSCR loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Luxury Rental DSCR Loans In New Jersey · Jersey Shore Vacation Rental Loans: DSCR Financing In Ocean City, Cape May And Long Beach Island · DSCR Cash-out Refinance In New Jersey: Pulling Equity From A Rental
Guides: DSCR Loans in Miami, FL · DSCR Loans in Florida
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
- Mortgage Loan Originator · NMLS# 1129696 · Verify on NMLS Consumer Access
- North Carolina Real Estate Broker · License# 343312 · Verify on NCREC
- North Carolina Insurance Producer · License# 19053198 · Property, Casualty, Life, Health · Verify on NAIC SBS
- Lendmire LLC · Firm NMLS# 2371349 · Verify firm licensure
Required disclosures. Lendmire (NMLS# 2371349) operates as a licensed mortgage broker, not a direct lender or depository. The discussion in this article is general in nature and should not be relied upon as financial, legal, or tax advice — every investment scenario is unique and should be reviewed by a qualified professional. Any loan inquiry is subject to lender underwriting, and this article is not a commitment to lend or a guarantee of approval. Mortgage rates, loan terms, and program guidelines vary by borrower, property, and state, and may change without notice. Equal Housing Opportunity. Verify licensure at NMLS Consumer Access.