LAMD-D39 Blanket DSCR (2–25 Properties) | DSCR Guidelines

Loan limits

Lien position: First lien – blanket
Minimum credit score: 660
Max LTV – purchase: 80% (700, DSCR >1.20, ≤$1.5M)
Max LTV – rate/term refinance: 80%
Max LTV – cash-out refinance: 75%
Minimum loan amount: $200K
Maximum loan amount: $4.0M
Cash-out (cash in hand) limit: $1M at 65%+ LTV; $2M below 65%.
LTV reductions & overlays: Portfolio-wide overlays: any 2–4 unit or condo in the pool caps at 75% purchase / 70% refi; any condotel 75% / 65% with $1.5M max; any rural 75% / 70%; any CT/IL/NJ/NY or declining-market property 75% / 70%. 25%+ of properties vacant: −10%. Interest-only 75% (70% cash-out), 680 FICO. Loan DSCR 1.00–1.20 uses a lower grid than above 1.20.

DSCR requirements

Minimum DSCR: Loan 1.00 / each property 0.75
DSCR below 1.00: Property-level ≥0.75 only
No-ratio (no DSCR calculated): No
How DSCR and qualifying rent are calculated: Loan DSCR (all rents ÷ total PITIA) must be 1.00+, and each property must reach 0.75 on its allocated payment. Vacant 2–4 unit properties (2+ vacant units) use 75% of market rent; vacant properties must be lease-ready, not under renovation.

Products & terms

Products: 15/30 fixed, 5/6 7/6 10/6 ARM
Interest-only: Yes – 680 FICO; 75% / 70% CO
Prepayment penalty: Up to 5 yr; fixed (≥3%) or declining (5% max, not below 3% in first 3 years) only; also charged on partial-release payments (based on release price). Not in AK, MI, NM, OH; IL & NJ only if entity-vested; MS declining only; PA not on 1–2 units at or below $329,411 (2026).
Reserves: 2 months per property; 6 months each over $1.5M total; 12 months each over $2.5M. Cash-out counts.

Borrower & credit

Housing payment history: 1x30x12 and 2x30x24.
Credit events (BK, foreclosure, short sale, modification): Bankruptcy, foreclosure, deed-in-lieu, pre-foreclosure, short sale, mortgage charge-off, lis pendens and notice of default all count as credit events and each requires at least 36 months of seasoning. Bankruptcy measured from discharge/dismissal; housing events from settlement; a foreclosure included in a bankruptcy runs from the earlier date. A notice of default is treated the same as a foreclosure (the former exception for a default cured with 12 on-time payments no longer applies). A charged-off second mortgage counts as a foreclosure from its charge-off date.
Forbearance, deferrals & modifications: Forbearance, modification, deferral or repayment plans on any property the borrower owns are acceptable once completed, with all related obligations satisfied and at least 3 consecutive on-time payments made as of the application date of the new loan. No 12-month seasoning period applies.
Collections, charge-offs, judgments & liens: For DSCR loans, collections and charge-offs can be ignored unless they affect title. All open judgments and involuntary liens must be paid at or before closing (no subordination). IRS installment plans OK with 2+ on-time payments and no recorded lien in the subject's county. Credit counseling OK after 12 on-time months.
Tradelines & credit depth: 2 tradelines reporting 24 months (active in last 12) or 3 reporting 12 months; waived if the borrower has three credit scores. Representative score is from the borrower/guarantor with the highest score.
First-time homebuyer: No
First-time investor: Not eligible; FTHB not eligible.
Foreign national: Not eligible (US citizens and permanent residents only).
ITIN borrower: No
Non-permanent resident: No (US citizen & PRA)
LLC / entity vesting: LLC, partnership or corporation formed primarily to own, finance, lease or manage real estate; US-domiciled; up to 4 members/managers; up to two entity layers allowed. Applications from members/managers representing at least 25% cumulative ownership – their credit is used for qualifying and pricing – and each must sign a full-recourse personal guaranty or be individually obligated on the Note; the guarantor must have authority to sign for the entity. Power of attorney not allowed on entity-vested loans.
Gift funds & assets: Not allowed.
Financed property / exposure limits: Lender exposure to one borrower/household: $5M UPB or 10 loans.
Other borrower rules: Escrows required (can't be waived). US citizens and permanent residents only.

Property

Eligible property types: SFR, 2-4, condo, condotel, rural (portfolio overlays apply)
ADUs & unpermitted additions: Total unit count (main dwelling plus ADUs) cannot exceed four. Each ADU must be smaller than the main house, built to a quality consistent with it, and have its own entrance, kitchen (cabinets, counter, sink with running water, stove), sleeping area and bathroom; space reachable only through, or open to, the main house isn't an ADU. The appraisal must describe the ADU and include at least one comparable with the same use and the same number of ADUs. An ADU that isn't allowed under zoning does NOT make the property ineligible if hazard insurance replacement cost covers it, the use conforms to the neighborhood, and the appraiser shows two comparable sales with the same non-compliant use – but its rent can't be counted. ADU rent counts only when the appraisal shows zoning is legal (permits verified where required); long-term ADU rent is the lower of market rent (1007/1025) or actual rent (lease copy required if transferred on a purchase); short-term ADU rent follows the STR documentation rules, with AirDNA bedroom count including the main dwelling and ADUs. Rents must be itemized when two ADUs generate income.
Non-warrantable condo: Condos are reviewed under program-specific project rules rather than a warrantable/non-warrantable split. Full review (condo questionnaire) required except site/detached condos, 2-4 unit projects, 5-10 unit projects not part of a larger development or master association, and projects with an unexpired Fannie Mae CPM approval. Unit 500+ sq ft with an operable kitchen and at least one bedroom; commercial space up to 50%; no more than 20% of units 60+ days delinquent on HOA dues. Single-entity ownership: 1-4 unit projects max 1 unit; 5-10 unit projects in a master association max 2; 11-20 units max 2; 21+ units max 20%. No investor-concentration limit. Litigation acceptable only for minor matters with no safety, structural, habitability or functional impact (e.g., non-monetary disputes, insurer-defended covered claims, HOA as plaintiff for minor or already-remediated issues, past-due assessments or foreclosure, localized damage to a non-subject unit). Established projects need 90% sold, 40% owner-occupied, all phases complete and HOA turned over; new projects 50% sold and 50% owner-occupied. Projects with critical repairs, unremediated special assessments for critical repairs, or safety/habitability violations are ineligible. Projects made up entirely of detached (site) units use single-family LTVs. Project exposure limit: lesser of $5M or 25% of units (projects over 4 units).
Condotel: 75% / 65%, $1.5M
Rural / acreage: Rural allowed (portfolio overlay 75% / 70%); max 5 acres per property.
Minimum square footage: SFR 700; 2-4 400/unit; condo 500
Mixed use: No
5+ units / multi-property: 2 to 25 properties, $200K–$4M loan, max $1M allocated per property; 5–8 units and mixed use not eligible. Property values $100K minimum and $1.5M per unit maximum. Partial release requires paying 120% of the allocated balance. Mixed purposes allowed (priced on the most conservative).
Ineligible properties: Manufactured/mobile homes, co-ops, timeshares and fractional ownership, boarding houses/B&B/PadSplit, healthcare/assisted-living use, properties with income-producing non-residential structures (billboards, cell towers, commercial workshops), agricultural features (vineyards, farms, ranches, orchards, equestrian), zoning violations or illegal use, domes, barndominiums, log homes not common to the area, houseboats, Native American reservation land, marijuana-related use, properties not accessible by standard roads or not suitable for year-round use, C5/C6 condition or Q6 quality, Hawaii lava zones 1–2 and coastal-erosion zones (Hawaii coastal properties subject to lender review), vacant land/land development, and unique properties with no comparable sales in the market. Also ineligible in the portfolio: 5–8 unit residential and 2–8 unit mixed use. Over 5 acres ineligible (no truncating). Leaseholds eligible where common.
Declining markets: If any property in the pool is in a declining market (per appraisal or lender-designated state): max 75% purchase / 70% refinance for the whole loan; no separate loan-amount cap on this program.
Appraisal, review & insurance: Full interior/exterior appraisal plus an appraisal review product (or second appraisal) for each property. Second appraisal required on loans over $2M (ask us whether this is measured on the total loan or a property's allocated balance) and on HPML flips. Transferred appraisals accepted. Escrow holdbacks not purchased.

Rental income

Rent used on a purchase: Gross monthly rent per long-term rental documentation
Rent used on a refinance: Same long-term rental documentation as single-property DSCR; leases can't be with an interested party or family member. A 2-4 unit property with 2+ units vacant counts as vacant and uses 75% of market rent for the vacant units; if 25% or more of the portfolio's properties are vacant, max LTV is reduced by 10%. Vacant properties must be lease-ready and not under renovation.
Vacant / unleased refinance: −10% LTV if ≥25% of properties vacant; vacant units at 75% market
Short-term rental (Airbnb/VRBO): Yes
Short-term rental documentation: Same STR documentation as single-property DSCR: must meet local ordinances; any of an appraiser STR analysis or 1007/1025 (data source, comps, daily rate, occupancy, seasonality), a 12-month property-manager statement (net of fees), 12 months of bank statements with rental records, or an AirDNA Rentalizer (purchase only, 12-month forecast within 90 days, 3 default comps). 12-month average required; lowest source used when there are several.
Short-term rental limits: Gross STR rents reduced by ≥20% expense factor

Refinance seasoning

Cash-out seasoning: Six months of ownership to use the current appraised value; under 6 months, value is limited to price plus documented improvements (except inherited or divorce-awarded property). Not eligible if there was a cash-out within the past 6 months, for land-contract payoffs, with a POA, or if proceeds go to personal debts/taxes/judgments. Paying delinquent taxes (60+ days) or refinancing a free-and-clear property counts as cash-out. Rate/term refinances seasoned 6 months or less are also valued at the lesser of the appraisal or price plus documented improvements (same inheritance/divorce exceptions). Investment properties listed for sale in the past 6 months are eligible for cash-out only with a prepayment penalty of at least 3 years (so only where a penalty is permitted).
Delayed financing (cash purchase recoup): Allowed for cash purchases within 6 months, treated as rate/term for pricing (cash-in-hand caps don't apply, except foreign nationals). Arm's-length purchase, documented funds, no liens; loan limited to documented investment, value capped at price plus improvements.
Recently listed for sale: For all refinances, value is the lower of the lowest list price in the prior 12 months or appraisal. Cash-out on an investment property listed within the past 6 months is allowed only with at least a 3-year prepayment penalty; any active listing must be cancelled before closing.

Other terms

Seller / interested-party concessions: Investment property: interested-party contributions up to 6%, for closing costs and prepaids only (never down payment or reserves). A borrower acting as their own agent may contribute commission within the limit. Excess reduces both price and value.
Secondary financing: Allowed if subordinated and included in CLTV (HELOCs counted at the full line amount unless past the draw period); no secondary financing from an interested party on purchases. The program's max LTV/CLTV limits apply.
State & local restrictions: Not available in Baltimore City MD, Philadelphia County PA, Puerto Rico, Guam or USVI. 2–4 units not eligible in IL and NY. All properties must be located in the same state. CT, IL, NJ, NY overlay (if any property is in these states): max 75% purchase / 70% refi (no separate loan-amount cap on this program). Prepayment penalties not allowed in AK, MI, NM, OH; in IL and NJ only for entity borrowers; PA not on 1–2 units at or below $329,411 (2026); MS declining only.

Additional details

Notes: All properties must be in the same state. Partial release at 120% of allocated balance. Allocated balance ≤$1M per property. Escrows required. Cross-collateral workbook required. Loan DSCR ≥1.00 and each property ≥0.75. Min $100K value per property. Experienced investors only. No MERS.

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