LAMD-D40 Blanket DSCR (2–15 Properties) | DSCR Guidelines

Loan limits

Lien position: First lien
Minimum credit score: 680
Max LTV – purchase: 75%
Max LTV – rate/term refinance: 75%
Max LTV – cash-out refinance: 70% (≤$1.5M, 700+); 60% at $2M
Minimum loan amount: $250K (min $150K value per property)
Maximum loan amount: $2.0M
Cash-out (cash in hand) limit: $500K above 60% LTV.
LTV reductions & overlays: Purchase/rate-term: 720+ 75% to $2M; 700 75% to $1.5M, 70% to $2M; 680 75% to $1M, 70% to $1.5M, 65% to $2M. Cash-out: 700+ 70% to $1.5M, 60% to $2M; 680 65% to $1M, 60% to $1.5M, not available above $1.5M. Interest-only: 700 FICO, max 75%. Declining market −5%.

DSCR requirements

Minimum DSCR: 1.10 loan-level AND 1.10 per property
DSCR below 1.00: No
No-ratio (no DSCR calculated): No
How DSCR and qualifying rent are calculated: Both the overall loan DSCR (all rents ÷ total PITIA/ITIA) and every individual property (rent ÷ allocated-loan PITIA) must be at least 1.10. Allocated amount = property value × loan LTV. A higher lease needs 3 months' receipts.

Products & terms

Products: 3/6, 5/6, 7/6 ARM; 30 fixed; 40yr IO
Interest-only: Yes – 700 FICO, 75%
Prepayment penalty: Per state law
Reserves: 6 months; cash-out counts.

Borrower & credit

Housing payment history: 0x30x12.
Credit events (BK, foreclosure, short sale, modification): 4+ years from housing events.
Forbearance, deferrals & modifications: A loan modification due to default counts as a housing event: it needs 4+ years of seasoning, measured from when the loan was permanently modified. Forbearance and deferrals are not addressed separately.
Collections, charge-offs, judgments & liens: Judgments/liens affecting title must be paid. Non-title collections/charge-offs within 3 years over $5,000 (individually or combined) must be paid; medical under $15,000 can stay. IRS plans OK if current and not liened. Past-due accounts brought current; no one currently in credit counseling/debt management. 60-day consumer lates within 4 years need an explanation. Credit can't be frozen.
Tradelines & credit depth: Each borrower/guarantor needs at least 2 tradelines reporting within the last 24 months with 12 months' history each, or 3 tradelines combined between borrower and co-borrower. Accounts may be open or closed. Authorized-user, deferred, collection/charged-off and bankruptcy-discharged accounts don't count. Current housing not on the credit report can count as a tradeline if bank records support it.
First-time homebuyer: No – borrowers must have at least 12 months of owning and managing income-producing real estate in the last 5 years.
First-time investor: No – 12 mo experience in last 5 yrs
Foreign national: No – foreign nationals are ineligible.
ITIN borrower: No
Non-permanent resident: No – non-permanent residents are ineligible (US citizens and permanent residents only).
LLC / entity vesting: LP, GP, corporation or LLC formed to own and manage real estate, with a personal guaranty. Max 4 entity owners. Guarantors must be managing members or majority owners and hold at least 25% combined. Up to 2 layers of entities allowed if ownership traces cleanly to the individual guarantors; entities layered with a trust are ineligible. Articles, operating agreement, EIN and good standing are required, dated within 30 days of closing.
Gift funds & assets: Family gifts allowed on purchases only, and not for reserves. Below 75% LTV the gift can cover the whole down payment; at 75% LTV or higher the borrower must put in at least 5% of their own funds. Not allowed on investment properties above 80% LTV.
Financed property / exposure limits: No cap on number of financed properties and no lender exposure limit on this program. No extra reserves for other financed properties.
Other borrower rules: US citizens and permanent residents only. Personal recourse/guaranty required. No additional borrowers may join the entity on title. Cash-out for personal use is ineligible. Builder refinances where the builder built more than 4 units in the project, and new construction where the borrower has a relationship with the builder/seller, are ineligible. Program requires lender approval and can't be registered with MERS.

Property

Eligible property types: 2–15 properties in the same state, each worth at least $150K: SFR (attached/detached/modular), PUD, townhouse, 2–4 units, warrantable condo, leasehold.
ADUs & unpermitted additions: Single-family homes with ADUs follow Fannie Mae's ADU rules (legal ADUs acceptable). Multiple dwellings on one lot are ineligible except legal ADUs. Unpermitted additions/alterations are judged under Fannie Mae rules – generally acceptable if typical for the market, well built and not given full value – rather than an automatic decline. Rent is the lower of lease or 1007 market rent.
Non-warrantable condo: Not allowed (warrantable condos only); co-ops not eligible.
Condotel: No
Rural / acreage: Max 20 acres; rural not specifically excluded
Minimum square footage: Not published – ask us about your scenario
Mixed use: No
5+ units / multi-property: 2 to 15 properties in the same state; $250K–$2M; each property worth at least $150K. Partial releases may be allowed if the mortgage documents permit them; releasing a property requires paying at least 120% of its allocated loan balance, and any prepayment penalty applies to the release price. 5+ unit buildings are ineligible.
Ineligible properties: Manufactured homes, 5+ units, log homes (faux-log by exception), condotels/motels, projects with registration services or limits on owner occupancy, unique properties, mixed use, model leasebacks, boarding houses, group homes, timeshares/fractional, assisted living, mandatory country-club memberships, zoning violations, under construction, barndominiums, agricultural zoning (by exception), Hawaii lava zones 1–2, multiple dwellings on one lot (legal ADUs OK), working farms, C5/C6, live/work condos, earth-berm homes, domes, houseboats, reservation land, marijuana use, theme-park resort properties. Leaseholds OK; max 20 acres.
Declining markets: 5% reduction to the LTV caps (declining per appraisal or any third-party valuation).
Appraisal, review & insurance: Every property needs its own appraisal (1007 rent schedule for single-family, 1025 for 2–4 units) plus a third-party review (CU/LCA score of 2.5 or less, CDA or ARR) that comes within −10% of the appraised value, or a field review/2055 follows. C5/C6 ineligible. Escrow holdbacks not allowed. Disaster-area damage over $2,000 or affecting habitability is ineligible. Manual underwriting.

Rental income

Rent used on a purchase: Lower of lease or 1007 market rent
Rent used on a refinance: Higher lease allowed with 3 consecutive months' receipt
Vacant / unleased refinance: Not eligible unless recently renovated (appraiser confirms).
Short-term rental (Airbnb/VRBO): No
Short-term rental documentation: N/A
Short-term rental limits: Short-term rental income not allowed.

Refinance seasoning

Cash-out seasoning: 6+ months of ownership (acquisition to note). Owned 6–12 months: LTV on the lower of purchase price plus documented improvements or appraisal. Refinancing a cash-out loan less than 1 year old counts as cash-out. Inherited or divorce-awarded properties have no seasoning. Cash-out for business purposes only (no renovations that make it uninhabitable). No POA on cash-out or entities.
Delayed financing (cash purchase recoup): Yes – for a cash purchase within 180 days of the new note date, arm's length. The source of the purchase funds must be documented and title must show no liens. LTV is based on the lower of the appraised value or purchase price plus documented improvements. The loan is treated as a cash-out refinance, so cash-out LTV, loan-amount and cash-out limits apply.
Recently listed for sale: If listed within 6 months of the note date: not listed at application, with a borrower letter and listing cancellation. Multiple listings within 12 months are ineligible.

Other terms

Seller / interested-party concessions: Interested-party contributions up to 6%.
Secondary financing: Not allowed – new or subordinated second liens are not available on this investment-property program.
State & local restrictions: All 50 states and DC; Puerto Rico, Guam, American Samoa, Northern Mariana Islands and the U.S. Virgin Islands are ineligible. Florida condos 3+ stories and 30+ years old (25+ years within 3 miles of the coast) must have completed SB-4D milestone inspections, any required structural repairs, and a structural integrity reserve study, or they are ineligible; even when compliant, Florida condo projects subject to SB-4D are case-by-case only and need an exception approval. Hawaii lava zones 1–2 are ineligible. All pledged properties must be in the same state.

Additional details

Notes: 680: 75/75/65 ($1M), 70/70/60 ($1.5M), 65/65 ($2M). Partial release requires paying at least 120% of the property's allocated loan balance.

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