Michigan DSCR Loans
🏢 For Real Estate Investors
Edward Kalavitz · Michigan Mortgage Lender & Broker · MLO NMLS #138424 · Private Mortgage Guarantee LLC · Licensed Michigan Realtor #6501386956 · Turnkey Realty LLC
Qualify for investment property financing based on rental income, not your personal income. Michigan DSCR loans require no tax returns or employment verification—perfect for self-employed investors. Learn how DSCR loans work with Edward Kalavitz, your trusted Michigan mortgage broker.
Not Sure Which Loan You Qualify For? — Michigan Mortgage Broker
See the rates. Not sure which loan fits your situation? The Michigan Mortgage Advisor answers that in 60 seconds — analyzing your credit, down payment, and goals to recommend the best loan program and show you your real monthly payment on Michigan real estate.
- Instant loan-type recommendation — FHA, VA, USDA, or Conventional
- Live rate and APR for your exact scenario
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Best loan for you: FHA
3.5% down
~$1,830/mo principal + interest
Your actual recommendation is calculated live based on your inputs.
What Are Michigan DSCR Loans?
Michigan DSCR loans (Debt Service Coverage Ratio loans) are investment property mortgages that qualify borrowers based on the property’s rental income rather than personal income. Instead of verifying your W-2s, tax returns, and employment, lenders look at whether the property’s rent covers the mortgage payment—making them ideal for self-employed investors and those with complex tax situations.
The DSCR compares the property’s gross rental income to its total mortgage payment (principal, interest, taxes, insurance, and HOA). A DSCR of 1.0 means the rent exactly covers the payment; 1.25 means rent exceeds the payment by 25%. Most lenders require a minimum DSCR between 1.0 and 1.25.
As a Michigan mortgage broker with over 25 years of experience, I help real estate investors throughout all 83 Michigan counties find the best Michigan DSCR loans options. Whether you’re buying your first rental property or expanding a portfolio, I’ll help you navigate your choices.
💡 Why Investors Love Michigan DSCR Loans
No income verification means no explaining complex tax returns, business expenses, or write-offs that make your income look lower than it is. With this program, the property qualifies itself based on rental income potential.
How Michigan DSCR Loans Work
The Basic Concept
Traditional investment property loans require full income documentation—tax returns, W-2s, pay stubs, and profit/loss statements. Michigan DSCR loans skip all of that. Instead, the lender asks one simple question: “Does this property’s rent cover its mortgage payment?”
What Lenders Look At
- Rental income: From appraisal rent schedule or existing leases
- Property expenses: PITIA (Principal, Interest, Taxes, Insurance, HOA)
- DSCR ratio: Rental income ÷ PITIA payment
- Credit score: Typically 660+ required
- Property type: 1–4 unit residential, condos, some commercial
What Lenders DON’T Look At
- ✗ Tax returns
- ✗ W-2s or pay stubs
- ✗ Employment verification
- ✗ Debt-to-income ratio
- ✗ Business financials
How to Calculate Your DSCR
DSCR Formula
PITIA = Principal + Interest + Taxes + Insurance + Association fees
Example Calculation
Let’s say you’re buying a rental property in Grand Rapids:
- Monthly rent: $2,000
- Principal + Interest: $1,200
- Property taxes: $300
- Insurance: $100
- Total PITIA: $1,600
DSCR = $2,000 ÷ $1,600 = 1.25
A DSCR of 1.25 means the property generates 25% more income than needed to cover the mortgage—an excellent ratio that most lenders will readily approve.
Key Benefits of Michigan DSCR Loans
📄 No Tax Returns Required
№ 01Skip the hassle of providing 2+ years of tax returns. No explaining business write-offs that reduce your reported income.
💼 No Employment Verification
№ 02Perfect for self-employed investors, business owners, retirees, or anyone with non-traditional income sources.
🏠 Unlimited Properties
№ 03No limit on how many investment properties you can finance. Build your portfolio without hitting conventional loan caps.
⚡ Faster Closing
№ 04Less documentation means faster underwriting. Close in 2–3 weeks instead of 30–45 days.
🏢 LLC/Entity Vesting
№ 05Close in your LLC or corporation name for liability protection. Most conventional loans require personal ownership.
💰 Cash-Out Available
№ 06Access equity from existing rentals without income documentation. Great for expanding your portfolio.
Michigan DSCR Loans Requirements
⚠️ Investment Property Only
Michigan DSCR loans are only for investment properties that will be rented out. You cannot use a DSCR loan for your primary residence or second home.
Eligible Property Types for Michigan DSCR Loans
Approved Property Types
- ✓ Single-family homes
- ✓ 2–4 unit properties (duplexes, triplexes, fourplexes)
- ✓ Condos and townhomes (warrantable)
- ✓ Short-term rentals (Airbnb, VRBO)
- ✓ 5+ unit apartments (select lenders)
- ✓ Mixed-use properties (some lenders)
Typically Not Eligible
- ✗ Owner-occupied properties
- ✗ Second homes/vacation homes
- ✗ Raw land
- ✗ Mobile homes without permanent foundation
- ✗ Commercial-only properties (retail, office)
Michigan DSCR Loans Rates and Costs
Interest Rates
Michigan DSCR loans rates are typically 1–2% higher than conventional investment property loans due to the reduced documentation and higher risk profile. Current DSCR rates range from approximately 7–9%, depending on credit score, down payment, DSCR ratio, property type, and loan amount.
Typical Costs
- Origination fee: 1–2 points
- Appraisal: $500–$800 (with rent schedule)
- Closing costs: 2–4% of loan amount
- Prepayment penalty: Often 3–5 years (can negotiate)
✓ Worth the Higher Rate?
For many investors, the higher rate is worth it for the ability to qualify without income documentation, close quickly, use an LLC, and scale without hitting conventional loan limits.
Mortgage Rates in Michigan
Competitive pricing personalized to your scenario. Rates shown reflect 740+ credit, 30-year fixed terms unless noted.
Purchase Loans
Conventional Purchase
15-Year Conventional
FHA 30-Year Purchase
VA 30-Year Purchase
USDA Purchase & Refinance
USDA 30-Year Purchase
FHA Streamline Refi
Conventional Refinance
Jumbo & High-Balance
Jumbo / High-Balance
Michigan DSCR Loans vs Conventional Investment Loans
Michigan DSCR Loans for Short-Term Rentals
Yes, you can use Michigan DSCR loans for Airbnb, VRBO, and other short-term rental properties! Many investors prefer DSCR financing for STRs because:
- Higher rents than long-term rentals often mean higher DSCR ratios
- STR income can be harder to document for conventional loans
- Lenders familiar with STR markets understand the income potential
How STR Income Is Calculated
- Existing STRs: 12-month booking history from Airbnb/VRBO
- New STRs: Projected income from AirDNA or similar platforms
- Lender analysis: May discount projections by 10–25% for safety
The Michigan DSCR Loans Process
Initial consultation
Contact me to discuss your investment goals and property details
Pre-qualification
Quick review of credit, down payment, and target property
Property identification
Find your investment property
Application
Submit basic application (much simpler than conventional)
Appraisal
Property appraisal with rent schedule or market rent analysis
DSCR calculation
Lender verifies rental income covers PITIA
Underwriting
Quick review—no income documentation to verify
Closing
Sign documents and get your keys!
Related Resources
Investment Property Loans
All investor financing options
Learn More →Conventional Loans
Traditional financing option
Learn More →Cash-Out Refinance
Access your rental equity
Learn More →All Loan Programs
See all your options
See All Programs →Frequently Asked Questions About Michigan DSCR Loans
QWhat is a DSCR loan?
A DSCR loan (Debt Service Coverage Ratio loan) is an investment property mortgage that qualifies borrowers based on the property’s rental income rather than personal income. Michigan DSCR loans compare the property’s gross rental income to its mortgage payment. No tax returns or employment verification required.
QWhat DSCR ratio do I need to qualify in Michigan?
Most Michigan DSCR loans require a minimum ratio of 1.0 to 1.25, meaning the property’s rental income must equal or exceed the mortgage payment by 0–25%. A DSCR of 1.25 means the property generates 25% more income than needed to cover the mortgage. Some lenders offer programs below 1.0 with higher rates.
QDo DSCR loans require tax returns?
No! Michigan DSCR loans do not require tax returns, W-2s, or pay stubs. Qualification is based solely on the property’s rental income potential, verified through an appraisal with rent schedule or existing lease agreements. This makes DSCR loans ideal for self-employed investors.
QWhat is the minimum down payment for a Michigan DSCR loan?
These loans typically require 20–25% down payment, though some programs allow as little as 15% down with higher rates. The down payment requirement may increase for lower DSCR ratios, lower credit scores, or cash-out refinances.
QCan I use a DSCR loan for short-term rentals like Airbnb?
Yes! Many Michigan DSCR loan programs allow short-term rental properties including Airbnb and VRBO. Lenders may use projected rental income from platforms like AirDNA or actual booking history. Some lenders specialize in short-term rental DSCR loans with favorable terms.
QWhat credit score do I need for a DSCR loan in Michigan?
Michigan DSCR loans typically require a minimum credit score of 660–680, with better rates available at 700+. Some lenders offer programs for scores as low as 620 with higher down payments and rates. Credit score requirements may also depend on the DSCR ratio and loan amount.
QCan I close a Michigan DSCR loan in my LLC?
Yes! Most Michigan DSCR loans allow you to close in your LLC or corporation name, providing liability protection for your investments. This is a major advantage over conventional loans, which typically require personal ownership. Some lenders may require a personal guarantee.
QHow many properties can I finance with Michigan DSCR loans?
Unlike conventional loans which limit you to 10 financed properties, Michigan DSCR loans have no property limit. You can finance as many investment properties as you qualify for, making DSCR loans ideal for building and scaling a real estate portfolio.
Why Work With Edward Kalavitz
Dual-licensed Michigan Mortgage Loan Originator (NMLS #138424) and licensed Michigan Realtor (#6501386956) — so the financing and the property are handled by one person who answers for both.
You are never required to use Edward for both. Financing and real estate representation are separate services — you are free to use any lender or any agent you choose, and use of one service is never a condition of the other.
Why Work With Me?
- ✓ 25+ years mortgage experience
- ✓ Multiple DSCR lender options
- ✓ Investor-focused approach
- ✓ Fast closings
- ✓ Available 7 days a week
- ✓ Serving all of Michigan
DSCR Loan Quick Facts
- ✓ Down payment: 20–25%
- ✓ Min DSCR: 1.0–1.25
- ✓ Tax returns: Not needed
- ✓ Credit score: 660+
- ✓ LLC ownership: OK
- ✓ Property limit: None
Popular Loan Programs: → Conventional Loans → Investment Loans → Jumbo Loans → Cash-Out Refinance → All Loan Programs
Helpful Resources: 📊 Mortgage Calculator ❓ Mortgage FAQ 🔍 NMLS Consumer Access 🏛 CFPB Talk to Edward Instead → Affordability Calculator → Apply Online Now → Call Edward Direct Schedule Consultation Call: (616) 633-3692
Watch: Meet Edward
Get to know Edward Kalavitz — learn how he helps Michigan families buy, sell, and finance homes with dual-licensed real estate and mortgage expertise.
What Clients Say About Working with Edward
These are verified Google reviews from Edward’s Google Business Profile. Edward is dual-licensed — Mortgage Loan Originator (NMLS #138424) and Michigan Realtor — so reviewers include both financing and real estate clients. Your Michigan mortgage broker can tell you how much room this leaves you.
“Very Professional and Thorough”
“Edward’s is very professional and thorough. Had a great experience working with him. Everything went very smooth.”
“Great to Have 2 in 1”
“Ed was very responsive, knowledgeable, and made our first home buying experience great! He’s a relator and lender, which was great to have “2 in1”. We were able to look at houses and run number the same day. He was very flexible with times we needed to set up showings, as well as very informative and organized with paperwork! I appreciate his expertise greatly!” Ask your Michigan mortgage broker to sanity-check the numbers you have been quoted.
“Works Hard 24/7”
“Ed is wonderful to work with! He is very thorough, experienced, and friendly. Ed works hard 24/7 to give you the best mortgage experience and is always able to help with whatever you need!”
“Above and Beyond”
“Edward is a great relator and loan officer. He helped my fiance and I buy our first home. We called him back when we were ready to sell and buy our forever home. He again went above and beyond to make the process swift and easy. I recommend him to my friends and family who are looking into buying, selling or refinacing their home!”
“Closing Came Sooner Than Anticipated”
“Edward was up front, professional and most helpful in first determining if I was a good candidate for a mortgage re-Fi. My case was Probably not the easiest , however, he made my “homework” manageable. The closing came sooner than anticipated , thanks to his perseverance, knowledge and professionalism .”
“Not Only My Realtor — My Friend”
“Edward was an excellent help in the most stressful time of my life. My son passed away in 2018 and I had to sell his home. Edward alleviated some stress by being patient, organized and communicated thoroughly the entire process. He not only was my realtor/loan officer but he was my friend! Highly recommend him for any home needs!”
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Real estate questions don’t wait for business hours — and neither does Edward Kalavitz.