The Quick Read: Few big banks write a home equity line on a rental, so lines that reach $1,000,000 usually come through a wholesale lender that Lendmire, a mortgage broker, can match to your file, and that size applies only to a first-lien line on a rental with no mortgage at 65% loan-to-value, qualified on the rent, subject to underwriting. The label “DSCR HELOC” also covers more than one structure, so the first job is to pin down what a lender is actually offering.
- A second-lien line behind your existing mortgage tops out at $500,000 and 70% combined loan-to-value, at a 720 credit score or better.
- The rent has to cover a stress payment on the entire credit limit, at a minimum 1.10x, so a larger limit raises the payment the rent must cover, even when you draw less than the full amount later.
- The program is offered in 15 of Lendmire’s 16 licensed states. Each figure is subject to lender guidelines and a complete review of property type, leverage, and credit.
Every figure here is a ceiling or floor from select wholesale-network programs. Each file is underwritten individually, and nothing here is a commitment to lend.
What a DSCR HELOC Actually Is
A DSCR HELOC is a revolving credit line secured by a rental property, qualified mainly on the rent instead of your personal income. You borrow, pay down, and borrow again within limits. The property’s rent has to cover the payment, subject to lender guidelines.
This program covers a non-owner-occupied rental of one to four units. It is written as a standalone second lien behind the first mortgage you keep. It can also be a standalone first lien on a rental that has no mortgage at all.
It is never closed together with a purchase. It is never a third lien. It is never a line on your own home or a second home. Your primary-residence HELOC is a different, owner-occupied product.
Qualification works on the rental’s income: no traditional personal-income documentation, W-2s, pay stubs, or personal income calculation, subject to lender guidelines. The rent, the lease, the credit report, and the valuation are all documented. The LLC can stay on title.
For the wider picture of how these loans fit together, Lendmire’s complete DSCR loans guide covers the core mechanics.
Do Banks Actually Offer a DSCR HELOC Up to $1,000,000?
Very few do. Nothing in the market shows a bank advertising a rent-qualified rental line up to $1,000,000 as a standard product. NerdWallet notes that not every HELOC lender accepts investment properties, and that qualification is strict. The White Coat Investor says fewer lenders offer these lines and that you need enough equity to qualify.
A BiggerPockets Rookie Reply discussion says many banks will not write a HELOC on a rental. Some refuse if the rental still carries a mortgage. An older BiggerPockets forum thread says community banks and credit unions are the usual sources, so call around.
That is why this page names no banks. The lenders that write these lines depend on your property type, credit, leverage need, and how the first mortgage is set up. A broker that shops several wholesale lenders matches the file to a program instead of asking you to cold-call institutions.
| Lender type | How it usually underwrites | What to expect |
|---|---|---|
| Big banks | Personal income, credit, DTI | Often decline rentals |
| Community banks, credit unions | Personal file, sometimes a P&L | Hit or miss by branch |
| Wholesale DSCR lenders (via broker) | Rent versus stress payment | Program rules are published |
The first two rows reflect how bank lines are commonly described by the sources above. Bank lines that run on your personal file are a different animal from this one. On this program, the ceiling on a second lien is 70% combined loan-to-value on an investment property, and the leverage tiers below govern.
How the Rent Test Works, Step by Step
The coverage test divides gross monthly rent by a qualifying payment. Wikipedia’s debt service coverage ratio entry defines the idea: income divided by debt service, where above 1.0 means the income covers the debt. This program’s minimum is 1.10x.
Here is how the pieces fit:
1. Find the rent. Rent is the lesser of the appraisal’s Form 1007 market rent and the lease, unless three months of receipts support a lease above market. A lease in place is required. A two-to-four-unit property can have at most 1 vacant unit.
2. Size the payment on the whole line. The qualifying payment is a fully amortizing principal-and-interest payment on the entire credit limit. It is figured at the start rate plus 2 percentage points. That is a stress payment, and the lender’s actual calculation governs.
3. Leave taxes and insurance out. Taxes and insurance are not part of this qualifying payment.
4. Divide. Rent over the stress payment has to reach 1.10x.
The full-limit rule is the part that surprises people. You are tested as if you had borrowed the whole line, even though you may not use all of it later. A $1,000,000 line is therefore tested as a $1,000,000 loan.
Run the logic on a modeled rental. Say its rent covers the stress payment on the full limit at about 1.15x. That clears the 1.10x minimum. Raise the limit and the stress payment rises with it, so the same rent might land near 1.05x and miss. The fix is a smaller line, not a bigger lease.
On a second lien, confirm on the file how the lender treats the first-mortgage payment in its coverage calculation. Program details differ, and the answer changes the math.
The Line-Size Tiers (and Where $1,000,000 Fits)
Line size is governed by lien position, credit score, and leverage. A $1,000,000 line is only possible as a first lien on a rental with no mortgage.
| Position | Credit score | Max leverage | Max line |
|---|---|---|---|
| Second lien | 720 or better | 70% CLTV | $500,000 |
| First lien | 740 or better | 75% LTV | $500,000 |
| First lien | 700 to 739 | 70% LTV | $500,000 |
| First lien, large line | 720 or better | 65% LTV | $1,000,000 |
Lines start at $50,000. CLTV (combined loan-to-value) adds the first mortgage balance and the new line, then divides by value. LTV is the same idea with only one loan. These are ceilings on an investment property, subject to underwriting, and not offers.
A second lien requires a score of 720 or better, while a first lien has a 700 floor. A borrower who keeps a first mortgage can only take a second lien, so on that file a score of 700 to 719 falls short of the second-lien requirement.
Picture an investor whose first mortgage sits at 45% of the property’s value. At a 70% combined cap, the new second-lien line can add up to 25 points of value. A first mortgage at 60% leaves only 10 points. The line size is value times the cap, minus what is already owed.
That is why $1,000,000 stays rare. It needs a rental with no mortgage and enough value that 65% of it supports a line that large. A declining-market flag lowers the ceiling by 5 points. Philadelphia lines carry a ceiling 10 points lower.
What the File Needs: Valuation, Title, and Credit
For lines up to $400,000, an automated valuation with a confidence score of 85 or better plus a property inspection report is acceptable. A full interior appraisal is also accepted. Lines above $400,000 need a full interior appraisal on Form 1004, 1073, or 1025. Appraisal waivers are not accepted.
Title follows size and lien position. A first lien and a second lien above $400,000 take a full title policy. Smaller second liens take an owner-and-encumbrance report. Hazard insurance covers both liens, with flood coverage where required.
On credit, the program wants no 30-day mortgage late in the last 12 months. It wants 48 months since a bankruptcy, foreclosure, short sale, or deed-in-lieu. Tradeline-depth rules are waived at 700 and above, and every tier here meets that score. No reserves and no cash to close are required, subject to underwriting.
Eligible borrowers are U.S. citizens, permanent residents, and non-permanent residents with a Social Security number. Foreign nationals and ITIN borrowers are not eligible on this program.
Plan to gather:
- the lease, plus rent receipts if you want a lease above market to count;
- your first mortgage statement, if you keep one;
- insurance on the property;
- entity documents and guarantor details if an LLC holds title;
- the credit report the lender pulls.
How Draws and Repayment Work
At least 80% of the line is drawn at closing, and the closing draw is never less than $50,000. On the smallest lines, that means the whole line is drawn at closing. Later draws are at least $5,000 each.
The draw period runs 5 years, interest-only on the drawn balance. Then a 25-year fully amortizing repayment period begins, for a 30-year maturity. The rate is variable.
Plan for the step-up. Interest-only payments stop when the repayment period starts. The payment then includes principal and gets recalculated over the remaining 25 years. Make sure the rent can carry that larger payment, because the qualifying test already assumes it, with the extra 2 percentage points built in.
Seasoning: Two Six-Month Clocks
A rental bought or refinanced inside the last 6 months is not eligible (that clock runs from the last note date to the new note date), and the owner must have held title for 6 months (settlement date to note date).
Where the General Rule Breaks
An LLC holds title. The line allows vesting in the owner’s LLC on investment property, subject to program terms. The members sign as guarantors. A title holder who is not a borrower signs a non-borrowing owner acknowledgment and the security instrument. The borrowers on the line need not be the borrowers on the first mortgage.
Your score sits between 700 and 719. With no mortgage, a first-lien line is possible at 70% LTV, on lines up to $500,000. With a first mortgage, the second-lien floor of 720 blocks the file. Exact terms depend on the lender’s guidelines, property type, leverage, and a full review of the borrower’s file.
Your property type may fall outside the list. Eligible types include single-family, PUD, townhome, two-to-four units, and warrantable and non-warrantable condominiums, plus lots up to 10 acres. Rural-designated property, row homes, condotels, commercial or agricultural property, leaseholds, land trusts, age-restricted communities, hobby farms, modular and log homes, land contracts, and mixed-use are out. So is a property listed for sale in the prior 2 months and one with a solar lien. The leverage tiers apply to every eligible property type.
You own many rentals. Exposure is capped at 5 loans or $2,500,000 per borrower with the program. A portfolio investor can reach that ceiling before running out of equity.
The property is your home. This line is never offered on an owner-occupied home. Do not misstate occupancy to fit a program.
Short-term rentals. 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.
You want a business line instead. Some investors with several properties pursue a business line of credit. That is a separate product, underwritten differently.
Which Product Fits You?
| Your situation | Likely fit |
|---|---|
| Keep the first mortgage, tap equity | DSCR HELOC, second lien |
| Rental with no mortgage, want revolving access | DSCR HELOC, first lien |
| Willing to replace the first mortgage | DSCR cash-out refinance |
| Strong traditional employment income, bank relationship | Personal-income HELOC at a bank |
A line suits investors who want revolving access, such as a bridge between a purchase and a later refinance. A BiggerPockets thread on buying a rental with a HELOC describes drawing on a line to buy and refinancing out of it later.
A cash-out refinance reads rent too, but it replaces your first mortgage. The honest tradeoff is giving up your existing first-lien terms for flexibility. A second lien lets you keep the first mortgage in place.
The better program for your situation turns on your equity, score, and goals. Lendmire’s guide How to Qualify for a DSCR HELOC Up to a $1,000,000 Credit Line walks through the qualifying steps.
Lendmire works with a multi-state network of wholesale DSCR HELOC lenders. It acts as the broker, so it does not lend or approve anything. It shops multiple lenders and matches the scenario to a program.
Key Terms Defined
DSCR (debt service coverage ratio): The property’s rent divided by its debt payment. Above 1.0 means the rent covers the payment.
HELOC (home equity line of credit): A revolving credit line secured by property equity.
CLTV (combined loan-to-value): The first mortgage balance plus the new line, divided by the property’s value.
Lien position: Your place in line for repayment. A first lien is paid before a second lien.
Draw period: On this program, the first 5 years, when you borrow and pay interest only on the drawn balance.
Stress payment: A test payment on the full credit limit at the start rate plus 2 percentage points, used only to qualify.
Frequently Asked Questions
Which banks offer a DSCR HELOC up to $1,000,000?
No bank is named here, because the label covers different structures and banks rarely write rental lines at that size. The $1,000,000 tier on this program is a first-lien line on a rental with no mortgage, at 65% LTV and 720 or better, subject to underwriting. A broker with several wholesale lenders can match your property to a program.
Can I get a $1,000,000 line behind my existing mortgage?
No. A second-lien line stops at $500,000 and 70% CLTV, at a 720 score or better. Only a first-lien line on a rental with no mortgage reaches $1,000,000.
How soon after buying a rental can I open one?
Two six-month clocks apply: the line is not available on a rental bought or refinanced in the last 6 months (last note date to new note date), and title must have been held for 6 months (settlement date to note date).
Do I need tax returns or W-2s?
No. The line qualifies primarily on property-level rental income covering the payment, subject to lender guidelines. Your lease, rent receipts if needed, credit report, and valuation are all documented.
Can my LLC hold title?
Yes, on investment property, subject to program terms. The members sign as guarantors, and a title holder who is not a borrower signs a non-borrowing owner acknowledgment.
Next Step
If you are considering a home equity line on a rental property and want to see how the numbers work, Lendmire can help you compare DSCR HELOC options based on the property, the rent, the equity available, credit profile, combined leverage, and your goals. Reach the team at 828-256-2183 or request a quote.
About Lendmire
Lendmire (NMLS# 2371349) is a mortgage broker licensed for consumer lending in 16 states. DSCR home equity lines of credit — revolving lines on non-owner-occupied one-to-four-unit rentals, qualified on the property’s rent instead of the owner’s personal income — are arranged through wholesale lenders in 15 of those 16 states (every licensed state except Tennessee), and every line is underwritten by the lender under its program guidelines. Scotsman Guide named Lendmire a Top Mortgage Workplace in both 2025 and 2026.
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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
1. NerdWallet
2. White Coat Investor: HELOC on Investment Property
3. BiggerPockets Rookie Reply on HELOCs for rentals
5. Wikipedia: Debt service coverage ratio
6. BiggerPockets thread on buying a rental with a HELOC
This article is part of Lendmire’s DSCR HELOC program — full qualification details, guidelines, and scenarios live on the program page.
Related reading: Banks That Offer a DSCR HELOC on a Non-Warrantable Condo · Banks That Offer a DSCR HELOC When the Appraisal Comes in Low · Banks That Offer a DSCR HELOC for BRRRR Investors Recycling Equity
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.