LAMD-D01 DSCR Standard 0.75+ (to $4M) | DSCR Guidelines

Loan limits

Lien position: First lien
Minimum credit score: 620
Max LTV – purchase: 80% (700 & 680, ≤$1.5M, DSCR ≥1)
Max LTV – rate/term refinance: 80% (same as purchase)
Max LTV – cash-out refinance: 75% (700 & 680, ≤$1.5M)
Minimum loan amount: $150K
Maximum loan amount: $4.0M on the grid (720 FICO: 65% purchase/rate-term, 55% cash-out). Above $4M (up to $5M) only by request – ask us before quoting.
Cash-out (cash in hand) limit: Unlimited ≤65% LTV; $1M above 65%
LTV reductions & overlays: 2–4 units and warrantable condos 80%. Non-warrantable condos 75% (one feature only). Condotels 75% purchase/rate-term, 70% cash-out. Rural up to 10 acres 75% with DSCR 1.00. DSCR 0.75–0.99: 75% max, 680 FICO and 6 extra months of reserves. STR: 5% below grid max. 1x30x12 housing: 80% and $3M. Credit event 2–4 years ago: 70% and $1.5M (foreclosure needs 3–4 years for this program). Vacant refinance without recent renovation: lesser of 70% or 5% below max (seasoned investors who own their primary). Declining market −5%.

DSCR requirements

Minimum DSCR: 0.75
DSCR below 1.00: Yes – 0.75–0.99: LTV ≤75, 680 FICO, +6 mo reserves. Grid: 700 → 75% ($1.5M) / 70% ($2.5M), CO 65%; 680 → 75/65, CO 65/60; 660 → 70% ($1.5M), CO 60%
No-ratio (no DSCR calculated): No – DSCR <0.75 ineligible
How DSCR and qualifying rent are calculated: Rents ÷ PITIA at the qualifying rate (IO payment may be used, not for foreign nationals); calculated precisely, no rounding. Minimum 1.00 normally; 0.75–0.99 allowed with conditions (foreign nationals 0.90+). Purchase: vacant uses 100% of market; leased uses lesser of lease or market; at-will tenancies documented by the seller. Refinance: lesser of lease or market; a lease above market usable if it runs 3+ months past closing with 2 months' receipts (new long-term leases up to 125% of market with first month and deposit received). Below-market leases expiring within 12 months can use market rent with a signed statement of intent to raise rents.

Products & terms

Products: 15- or 30-year fixed; 5/6, 7/6 and 10/6 SOFR ARMs (6% margin, qualified at the start rate). Interest-only available on the 30-year fixed, 7/6 and 10/6 ARMs (10-year IO period); no 5/6 IO and no 40-year term on this program.
Interest-only: Yes – 680 FICO, max 80% LTV; 10-year IO on the 30-year fixed, 7/6 or 10/6 ARM (no 5/6 IO, no 40-year term). The IO payment may be used for DSCR except for foreign nationals.
Prepayment penalty: Prepayment penalty allowed on business-purpose loans: 1–5 year terms, six months' interest on amounts prepaid over 20% of the original balance in any 12 months. Minimum 3-year prepay on loans over $2.5M. NJ: a loan with a prepay must close in a corporation. PA: no prepay on 1–2 units under $319,777.
Reserves: 6 months PITIA up to $1M; 9 months over $1M to $3M; 18 months over $3M to $4M. DSCR under 1.00 (including foreign nationals) adds 6 months. Foreign nationals need 12 months minimum. No reserves required for other properties owned.

Borrower & credit

Housing payment history: Max 1x30x12 (priced; caps at 80% and $3M). Rent-free allowed with documentation. Mortgage ratings only required for subject, primary, second home and mortgages on credit (if at least 3 mortgages rate 0x30 for 12 months).
Credit events (BK, foreclosure, short sale, modification): Foreclosure, short sale, deed-in-lieu, short payoff, any bankruptcy (including active – ineligible), modification (except COVID-forbearance-related), or 120+ day late. Under 2 years: ineligible. 2–4 years: allowed at 70% max and $1.5M (foreclosures only 3–4 years for this program). Over 4 years: standard. No active NOD or lis pendens.
Forbearance, deferrals & modifications: Mortgage forbearance: if all payments were made, the loan just needs to be reinstated (no wait); if payments were missed, 3 on-time payments after forbearance ended (missed payments may have been added to the balance). A modification resolving a COVID forbearance, or from a forbearance exit, isn't a credit event. Non-mortgage accounts may stay in forbearance with the payment counted.
Collections, charge-offs, judgments & liens: Collections/charge-offs may stay open if under $5,000 each or over 24 months old with an aggregate under $15,000 and no title impact; medical collections can stay regardless. Others must be paid unless covered by reserves (max $15,000 each, 80% LTV, 680 FICO). Judgments and tax liens may stay on a repayment plan with 6 months of on-time payments (subordinated if recorded).
Tradelines & credit depth: Each applicant needs 3 tradelines and 24 months of credit history, with one tradeline active in the last 6 months and one seasoned 24 months (if spouses apply together only one must meet it; unmarried co-borrowers who meet 2 of 3 tests – living together 2+ years, a joint tradeline, joint asset accounts – are treated as spouses; authorized-user accounts don't count). Gaps can be bridged with alternative tradelines rated 0x30x12: with 3 tradelines on credit, add 1 if a housing payment is among the credit or alternative lines, otherwise 2; with only 2 tradelines, add 2 if one is a housing payment, otherwise 3. US citizens living overseas may use a financial-institution letter or 3 foreign credit reference letters. Non-permanent residents need a 2-year credit history with no waiver.
First-time homebuyer: Not allowed (case-by-case if one applicant is FTHB)
First-time investor: A 12-month landlord history (any time, not only the last 3 years) is required unless DSCR is 1.00+; waiver also available with 680 FICO, 0x30x12, no forbearance with missed payments in 12 months and owning their current residence (refinances: acquired within 12 months with 3 months' rent receipts). All applicants must own a primary residence or an investment property.
Foreign national: Yes – 680 or no FICO (no-score files underwritten at 680): 75% ($1.5M) / 65% ($2M) purchase and rate/term; cash-out 60% (grid shows $2M, but the general loan-limit section caps foreign-national cash-out loans at $1.5M). DSCR 0.90+ (0.90–0.99 adds 6 months' reserves); IO payment can't be used to qualify; 12 months' reserves minimum; no gifts; no rural properties or properties over 2 acres; escrows and ACH payment required; landlord history not required.
ITIN borrower: No
Non-permanent resident: Yes – A05, E, G, H, L, O, P, R1 or TN visa holders with 2+ years living and working in the US, a valid SSN and established credit. Max 75% LTV and $3M loan amount.
LLC / entity vesting: LLC, partnership or corporation (US-formed; max 4 owners, all natural persons; applicants must own more than 50% of an LLC or at least 50% of a partnership/corporation); all applicants also sign the note individually. Entities owned by other entities or trusts, non-profits, land trusts, IRAs and life estates are ineligible. NJ with a prepayment penalty: corporation only, with full-recourse guarantees.
Gift funds & assets: Allowed from a relative, but the borrower must put in 5% of the purchase price from their own funds. Not allowed on 5–10 units or for foreign nationals. Gifts of equity not allowed on investment properties.
Financed property / exposure limits: Lender caps at 8 loans / $10M per borrower under this program suite; no more than 10% of a PUD/condo project (1 unit if 10 or fewer units; 20% max concentration in any Florida condo project).
Other borrower rules: Qualifying score is the highest middle score among borrowers/guarantors (25%+ owners); every borrower needs at least 620. Non-occupant co-borrowers not allowed. Ineligible: irrevocable trusts, borrowers with diplomatic immunity, owners of federally illegal businesses (exception only), and mortgage professionals. Power of attorney not allowed on cash-out loans or entity/trust-vested loans.

Property

Eligible property types: 1-4 unit investment
ADUs & unpermitted additions: Up to 2 ADUs allowed if the appraiser states they're legally permitted and rentable, with like-kind comparable sales and rentals nearby. ADU rent counts only if the appraiser verifies with the building department that the unit is legal and may legally be rented: lesser of lease or market rent if leased; 100% of market if vacant on a purchase. Unpermitted additions (not ADUs) are case-by-case with no value given.
Non-warrantable condo: One non-warrantable feature allowed at 75%: investor concentration up to 60% (projects meeting presale), reserves under 10% with a funding plan and reserve study, commercial space up to 40% (single entity max 20%), or master deductible up to 10%.
Condotel: Allowed at 75% purchase/rate-term, 70% cash-out: unit 400+ sq ft with some bedroom separation and a full kitchen (stove/oven), in a resort area, on the approved hotel-brand list or a resort/metro area under a nationally recognized high-end brand; no fractional/timeshare, no mandatory rental pools, no black-out dates; commercial up to 40%.
Rural / acreage: Rural up to 10 acres allowed at 75% with DSCR 1.00+; other rural properties ineligible. Agriculturally zoned up to the acreage limit OK if no agricultural use and no marketability impact. DSCR acreage max 10 (exceptions possible).
Minimum square footage: 500 sq ft (condotel units 400 sq ft).
Mixed use: Case-by-case
5+ units / multi-property: Yes –(5–10 units)
Ineligible properties: Over 10 acres for DSCR (exception possible), agricultural zoning over 20 acres, income-producing acreage, manufactured/mobile, modular, oil/gas leases, unique properties, working farms, co-ops, C5/C6, condo conversions not meeting Fannie Mae, raw land, commercial, earth-berm homes, environmental conditions, lagoons/cesspools, places of worship, timeshares, boarding houses, assisted living, reservation land, houseboats, fractional, marijuana use, TICs, model leasebacks, private transfer fees, under 500 sq ft. Hobby farms, log homes and mixed use are case-by-case.
Declining markets: 5% below the maximum LTV, plus credit-risk review.
Appraisal, review & insurance: One full appraisal up to $2M; two full appraisals over $2M. Every appraisal gets a CDA review (a CU score of 2.5 or less may substitute at the lender's discretion, except on loans over $1.5M up to $2M). Appraisals good for 120 days (recertification to 180). Transferred appraisals considered with a CDA within 0 to +10%. Unpermitted additions case-by-case: appraiser must confirm workmanlike quality and no adverse marketability impact, and the addition gets no value. Declining market: 5% below max with credit-risk review. Escrow holdbacks up to 30 days/$25K on purchases (case-by-case).

Rental income

Rent used on a purchase: 100% market if vacant; lesser of lease or market
Rent used on a refinance: Lesser of lease or market; higher lease with 3+ mo remaining & 2 mo receipts; new lease up to 125% of market; below-market leases may use market
Vacant / unleased refinance: 90% of market rent if renovated within 6 months and listed for rent at or above market (up to max LTV); otherwise, for seasoned investors who own their primary, 90% of market at the lesser of 70% or 5% below max. 'Vacant' on 2–4 units means most units unleased.
Short-term rental (Airbnb/VRBO): Yes
Short-term rental documentation: Lease term under 6 months; borrower shows STR management experience; property listed on an STR site in an STR-supportive market where STRs are legal; a 12-month income statement not prepared by the borrower; DSCR 1.00. Purchase: lesser of the 12-month statement or 90% of a third-party estimate (AirDNA Rentalizer, NAN STR, Opteon STR, STRpro), with at least 12 months of prior STR use. Refinance: 12-month statement with a 25% vacancy factor; gross rents can't decline more than 10% over 6 months.
Short-term rental limits: Max LTV 5% below the grid; DSCR 1.00+.

Refinance seasoning

Cash-out seasoning: 3 months on title as of the note date (transfer from an entity or trust counts if the borrower held 50%+ for 3 months). Value: owned under 6 months uses the lesser of purchase price plus documented improvements or appraised value; owned 6–12 months uses the lesser of purchase price or appraised value unless the appraiser supports the increase. Delayed financing available within 6 months.
Delayed financing (cash purchase recoup): Yes – cash purchase within 6 months of application; proceeds capped at the documented investment; LTV on the lower of cost plus improvements or appraised value; no gift recoupment; priced as cash-out.
Recently listed for sale: Refinance of a property listed in the last 6 months: must be delisted before funding with a motivation letter to keep it; cash-out gets extra review.

Other terms

Seller / interested-party concessions: Interested-party/financing contributions up to 6% at any LTV, limited to actual closing costs and prepaids.
Secondary financing: New or existing secondary financing allowed within the program's CLTV limits. It need not be institutional, but must carry a market rate, have no negative amortization, and not balloon within 5 years of the new first mortgage.
State & local restrictions: NJ investment loans with a prepayment penalty must close in a corporation (not an LLC) with full-recourse guarantees. PA: no prepay on 1–2 units under about $320K.

Additional details

Notes: Grid DSCR ≥1 purch/RT: 720 65% $4M; 700 80% $1.5M / 75% $2.5M / 70% $3M; 680 80% $1.5M / 70% $2.5M / 65% $3M; 660 75% $1.5M / 65% $2.5M; 640 70% $1.5M; 620 65% $1.5M. Cash-out: 720 55% $4M; 700 75/70/65; 680 75/65/60; 660 70/65; 620 65%. Min 3-yr PPP >$2.5M. 2-4 units & warrantable condos max 80%. PA PPP limits.

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