The Quick Read: A DSCR price sheet is a matrix. It sets a base price for a standard file, then adds or subtracts for each way your deal differs, and a duplex, triplex, or fourplex usually carries its own property-type row. You read it by finding your credit tier, leverage band, and coverage ratio, then layering the 2-4 unit and loan-purpose adjustments on top.
- The base price is only a starting point. Credit, leverage, coverage, loan size, purpose, property type, and prepayment structure each move it.
- On a 2-4 unit, the combined rent of all units is measured against one building payment.
- Two caps apply at once. The leverage cap and the coverage tier both limit the loan, and the tighter one governs.
- A prepayment penalty can move price as much as a small change in coverage.
- Clearing 1.00x is not the same as positive cash flow.
Lendmire is a mortgage broker. It arranges these loans through a wholesale network of DSCR lenders, so what follows comes from reading many lenders’ sheets side by side, not from one lender’s marketing page. Program details change, and every file is underwritten individually.
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Rate source: Freddie Mac 30-yr average via FRED® — Federal Reserve Bank of St. Louis · effective Oct 15, 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 Oct 15, 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.
Key Terms Defined
- DSCR: the property’s gross monthly rent divided by its full monthly obligation (principal, interest, taxes, insurance, and association dues).
- PITIA: the full monthly obligation that sits under the DSCR ratio.
- LTV: the loan balance divided by the property value or price, shown as a percentage.
- Price adjustment: a plus or minus applied to the base price when your file differs from the standard file.
- Par: the pricing point where the quote carries neither a credit nor a cost in points.
- Prepayment penalty: a fee charged if you pay off or refinance the loan inside a set period, usually stepping down each year.
What a DSCR Price Sheet Is (and What It Isn’t)
A price sheet is a lender’s pricing grid, not a quote and not a commitment. It lists a base price for a stock borrower, then a set of adjustments. Your quote is what results when someone applies those adjustments to your actual file.
No government body owns this grid. DSCR loans are business-purpose products, so each lender or investor publishes its own sheet and reprices it as the bond market moves. A sheet that was accurate last week may not match today’s.
For a sense of how grid pricing works in general, the agency world offers an analogue. Fannie Mae’s loan-level price adjustment matrix prices by credit score, LTV, loan purpose, occupancy, and number of units. DSCR loans are not agency products, and the agency numbers do not apply to them. But the logic is the same: a base, then adjustments stacked on top for each risk the lender sees.
| Document | What it is | Is it binding? |
|---|---|---|
| Price sheet | Lender’s grid of base price and adjustments | No |
| Quote | Your file run through the grid | No, until locked |
| Term sheet | Written summary of proposed terms | Depends on its wording |
Anatomy of a Sheet
Most sheets share the same regions. Knowing them tells you where to look first.
1. Base grid. Credit tier on one axis, LTV or coverage band on the other. This sets the starting price.
2. Price columns. Pricing is often shown as a price at a given note rate. A lower note rate costs more upfront. A higher one may return a credit.
3. Adjustment tables. Separate lists for loan purpose, property type, loan size, and similar items.
4. Prepayment section. Options for the penalty length and how each one shifts price.
5. Footnotes and program notes. This is where overlays, unit-count carve-outs, and exceptions hide.
Read the footnotes. Eligibility limits for a 2-4 unit often live there rather than in the grid.
Step by Step: Find Your Cell
Step 1: Establish the rent used for lender review. For a 2-4 unit, all unit rents are added together and measured against one building payment. Gross rent is used. Vacancy, management, and repairs are not deducted at this size. Many programs take the lower of the in-place lease or the appraiser’s market rent, so a strong lease does not rescue a low appraisal. A vacant unit is generally underwritten on market rent.
Step 2: Build the full payment. Leaving out taxes, insurance, or association dues produces a falsely high ratio. Insurance on multi-unit buildings is a common pressure point, so get a real quote before trusting your number.
Step 3: Compute coverage. Divide rent by the full payment. At 1.00x, rent equals the payment. Above that, rent exceeds it. Across the network, 1.00 is where select programs start, and stronger ratios open better pricing and leverage. A separate select-lender path takes coverage below 1.00, with leverage and terms adjusted.
Step 4: Place your credit tier. A 620 floor exists in parts of the network. Most programs want around 660, and 700 or higher unlocks the strongest leverage tiers.
Step 5: Check leverage. Purchases typically land at 75%-80% LTV. Select high-leverage programs reach 85% LTV on a purchase with roughly a 700 or higher score. A cash-out refinance on a standard rental tops out around 75% LTV across most of the network, with about six months of seasoning the common expectation.
Step 6: Layer adjustments. Add the 2-4 unit row, then cash-out if it applies, then loan size, then the prepayment choice. Adjustments stack. Treat the total as a sum, not a single line.
Step 7: Translate to price. Compare the resulting price against points or credits. A quote near par is a different trade than one that charges points for a lower note rate.
Why a 2-4 Unit Reads Differently
The appraisal is the first difference. Fannie Mae’s Selling Guide lists Form 1025, the Small Residential Income Property Appraisal Report, for two- to four-unit properties, including units in condo, PUD, or co-op projects (see the Fannie Mae Selling Guide on appraisal report forms). DSCR loans are not agency loans, so this is a contrast on form names only. The practical point is that a 1025 builds an operating picture across every unit, while a single-family file leans on the one-unit rent schedule.
Combined rent is the second difference. Several units sit against one payment, so a multi-unit building often shows a stronger ratio than a comparable single-family rental. That benefit can be partly offset by the property-type adjustment and tighter leverage on some programs.
Third, a 2-4 unit is generally not treated as multifamily in mortgage-industry usage. Commercial files use net operating income over annual debt service. Residential 1-4 unit DSCR typically uses gross rent over the full payment. Above four units, expect commercial-style underwriting.
Fourth, one vacant unit moves the whole file. In a fourplex, losing a quarter of the rent can drop you a coverage band, and a lower band means a different cell. Run the ratio with each unit empty before you rely on it.
Two Caps, One Loan
Think of the sheet as applying two limits at once. The leverage cap limits the loan size. The coverage tier limits the price and sometimes the leverage too. The lender uses whichever is tighter.
| Constraint | What it limits | Where it shows up |
|---|---|---|
| Leverage cap | Maximum loan vs. value | LTV axis of the grid |
| Coverage tier | Pricing and sometimes leverage | Coverage band |
| Credit tier | Pricing and top leverage | Credit axis |
A larger down payment lowers the payment and can lift the ratio. It never erases leverage caps, credit floors, reserve rules, or property eligibility. The strongest files clear both tests: enough equity and enough rental coverage.
Price, Points, and Prepayment
Prepayment structure is the lever many investors underprice. A longer penalty generally lowers the cost of the loan. A shorter one, or none, generally raises it. A common schedule steps down over five years, from 5% of the balance in year one to 1% in year five.
The trade is exit flexibility against pricing. If you may sell or refinance early, a longer penalty can cost more than the pricing benefit saves. A prepayment penalty is a fee for paying off a loan early, so it makes sense to compare total cost against a no-penalty option. Also confirm whether the penalty is hard (triggered by a sale or refinance) or soft (refinance only), and whether it applies to the unpaid or original balance.
Term structure moves price too. The spine of the network is the 30-year fixed. Extended terms such as 40-year and interest-only periods are available through select lenders, and ARM structures exist for investors who want them. On some programs an interest-only period changes the coverage denominator to interest plus taxes, insurance, and dues. Above $2,500,000, the network generally holds to 30-year fixed structures.
What the Sheet Won’t Tell You
A sheet does not show every limit. Watch for these:
- Overlays and carve-outs. Unit-count rules and property-type limits sit in footnotes or separate guideline matrices.
- Effective date. Sheets reprice regularly. Confirm the date on any sheet before comparing it.
- Lock behavior. A quote is not a lock. Ask how long a lock holds and what an extension costs.
- Ineligible property types. Manufactured homes, log homes, and barndominiums are not offered in the network’s DSCR programs.
- Owner occupancy. 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.
- Short-term rentals. STR files get their own treatment. Purchase leverage tops out at 75% LTV, refinance sits around 70%, and cash-out at 70% on short-term-rental collateral. Expect a 640 or higher score and about 12 months of hosting history, with a 1.00 coverage floor on purchases and 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. These specifics are subject to lender guidelines and a full review of property, leverage, and credit.
Reserves also sit outside the grid. They vary by lender, leverage, loan size, and transaction type, commonly around six months of PITIA. Conservative rate-and-term files at modest leverage under $1,500,000 can see reserves waived, and larger loans typically step up to about nine months.
If you are weighing very large balances, Lendmire’s piece Can a Traditional Jumbo Finance a $3M Rental on a 2-4 Unit? covers the alternative lane. Standard DSCR programs in the network generally run up to $3,000,000, and smaller balances can route through select lenders.
DSCR vs. conventional financing
There are two common ways to finance an investment property, 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.
Comparing Two Sheets
Lenders rarely lay out a sheet the same way. Normalize before you compare:
1. Match the effective dates.
2. Put both on the same credit tier, LTV, and coverage band.
3. Apply the same prepayment structure to each.
4. Add the 2-4 unit and loan-purpose adjustments to both.
5. Compare price and points together, not the headline note rate.
6. Compare total cost over the hold you actually expect.
A lower quote with a five-year penalty is not the same product as a slightly higher one with none.
Questions to Ask Before You Lock
- Which unit-count and property-type adjustments apply to this building?
- Does the program use the lower of lease or market rent?
- How is a vacant unit treated?
- Which penalty structure is priced in, and is it hard or soft?
- What reserves apply at this leverage and loan size?
- What is the lock period, and what does an extension cost?
- Does a sub-1.00 path exist for this file, and how do leverage and terms change?
The complete DSCR loans guide covers the wider program picture.
Common Misreads
“DSCR uses my income.” It does not. The file qualifies primarily on property-level rental income covering the payment, subject to lender guidelines.
“1.25 is required.” That figure comes from commercial lending. On residential DSCR, 1.00 is where select programs start, and stronger ratios earn better pricing.
“Above 1.00 means positive cash flow.” Not so. The ratio compares rent to PITIA only. Repairs, vacancy, management, utilities, and capital expenses sit outside it.
“The lowest quote wins.” Often a lower price comes with a longer prepayment penalty.
“A 2-4 unit is multifamily.” In mortgage usage it generally is not, and the difference changes the underwriting method.
Tax treatment varies; investors should keep clear records and speak with a qualified tax professional before relying on any deduction.
Frequently Asked Questions
Is a price sheet the same as a quote?
No. A sheet is the lender’s grid. A quote is your file run through it, and neither is a commitment until terms are locked. Sheets reprice as markets move, so a quote built from an old sheet can differ from today’s.
Do the adjustments really stack?
Yes, in general. Credit, leverage, coverage, loan purpose, property type, and prepayment each apply on top of the base. Limits on how far they stack vary by lender, so ask for the full adjusted total rather than adding lines yourself.
Why does a duplex price differently from a single-family rental?
The lender sees a different property type, an appraisal built across several units, and one payment against combined rent. Combined rent can strengthen coverage, while the property-type row and leverage limits can offset some of that gain.
What happens if one unit is vacant?
A vacant unit is generally underwritten on the appraiser’s market rent, depending on the program. If that lowers combined rent enough, your coverage band can drop, which moves your cell. Test the ratio with each unit empty.
Does interest-only change how I read the sheet?
On some programs, yes. Coverage may be measured against the interest-only payment plus taxes, insurance, and dues, and the pricing row differs from a fully amortizing loan. Interest-only periods are available through select lenders in the network.
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. Lendmire arranges DSCR investor loans across 40 states plus Washington, D.C., through select lenders, and nothing here is a commitment to lend.
Across most duplex, triplex, and fourplex files, the cell you land in is set less by the borrower’s résumé than by two numbers: the appraiser’s rent figure and the leverage cap for the unit count.
About Lendmire
Lendmire is a DSCR-focused mortgage brokerage, NMLS# 2371349, placing investor loans across 41 markets, including Washington, D.C. DSCR eligibility is generally reviewed by the lender around a property’s rental income rather than personal income documentation, which fits LLC-held rentals, self-employed investors, and portfolios scaling past conventional financed-property limits. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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References
1. Fannie Mae Selling Guide B4-1.2-01
This article is part of Lendmire’s DSCR loan program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: How to Prepare Leases and a Rent Roll for a 2-4 Unit DSCR Loan · Can a Five-Unit Short-Term Rental Building Get a DSCR Loan? · 2-4 Unit Airbnb Building vs Five-Plus-Unit Building for a DSCR Loan
Brandon Miller
Founder & CEO, Mortgage Loan Originator, Lendmire LLC
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Disclosure information. Lendmire is a state-licensed mortgage brokerage under NMLS# 2371349. Lendmire is not a depository institution, direct lender, or financial advisor — all loans referenced are placed through wholesale lender partners and are subject to each lender's underwriting standards. This article is provided for general informational purposes and is not a commitment to lend, nor does it constitute financial, legal, or tax advice. Loan programs, terms, rates, and qualification standards change without notice and depend on borrower profile, property type, and the state in which the subject property is located. Equal Housing Opportunity provider. NMLS Consumer Access: nmlsconsumeraccess.org.