DSCR is the ratio of a rental property's monthly net operating income to its monthly debt service (PITIA — principal, interest, taxes, insurance, association). DSCR of 1.20 means the property generates 20% more income than the monthly mortgage payment.
DSCR is the qualifying ratio for non-QM rental loans. Programs in the network typically require DSCR ≥ 1.20 at the standard pricing tier, with reduced-coverage tiers down to 0.75 at higher rates and lower leverage. DSCR is a computed output, not borrower input — calculated by the lender from verified rent (market rent or signed lease) and verified PITIA.
See also: PITIA, Long-Term Rental Loan.