Financing
DSCR loans
in Myrtle Beach.
By Devin Day, Operations Officer · Chapter3 Realty · Updated September 11, 2026
DSCR loans are how most Grand Strand investors finance buy-and-hold property: the loan qualifies on the rent, and the rules change for condotels and LLCs.
At a glance
Decide in ten seconds if this fits you
Why people do it
- +No tax returns or W-2s needed
- +Works for self-employed and portfolio buyers
- +The deal stands on its own numbers
- +Can close in an LLC
What can go wrong
- !Bigger down payment than a normal loan
- !Rates are higher than on a standard mortgage
- !Weak rent means no loan
- !Some condo buildings do not qualify
The five steps
How a DSCR loan works, step by step
A DSCR loan qualifies on the property's own rent, not your tax returns. DSCR is short for debt service coverage ratio. It is the rent the home collects, divided by the loan payment it must cover. No W-2s, no tax returns, no debt-to-income math. Most of the Grand Strand investment purchases Chapter3 closes are DSCR loans, so the steps below are the ones our agents and our lending partner run every week.
- 1
Find the property. The loan is judged on the property's rent, not on your income.
- 2
The appraiser sets the market rent. The lender uses that figure. On a short-term rental, only 75 percent of it counts.
- 3
Divide the rent by the payment. That figure is the DSCR. Above 1.00 means the rent more than covers the payment.
- 4
Show credit and the down payment. A score in the high 600s and up, and 15 to 25 percent down on most Grand Strand deals.
- 5
Close in your name or an LLC. No W-2s and no tax returns are asked for at any step.
That fits self-employed buyers and investors building a portfolio. The loan can also close in an LLC, a company you own that holds the property, which keeps a portfolio tidy. These loans are for property you rent out, not property you live in. If you plan to use the place yourself for more than two weeks a year, tell your lender early, because that changes which loans you qualify for.
The math
How to calculate DSCR
Run your own numbers
This clears the range most lenders want on a purchase, 1.10 to 1.25 or better.
The lender judges the deal on that number. Above 1.00, the rent more than covers the payment. On a purchase, aim above 1.00. On a refinance, our preferred lender starts writing DSCR loans at 0.75.
Qualifying
What lenders check
Every lender differs a little, but most DSCR programs look at four things.
- ✓
The ratio. Purchases want 1.10 to 1.25 or better. Refinances can go as low as 0.75, but over 1.00 is the goal.
- ✓
Your credit. A score in the high 600s and up.
- ✓
The down payment. 15 to 25 percent on most DSCR purchases here, and more on a condotel. Figures from BrickWood Mortgage.
- ✓
Short-term rental income. Appraisers here often estimate high, so only 75 percent of a short-term estimate counts toward the ratio.
What if the ratio is below 1.00?
A ratio of 1.00 means the rent exactly matches the payment. Above 1.00, our preferred lender asks for a standard investor down payment. Below 1.00, BrickWood Mortgage still writes the loan, down to a 0.75 ratio, with a larger down payment and a higher rate. Our agents run that ratio on a Grand Strand address before you offer, so you know which side of 1.00 you are on.
Local wrinkles
Where DSCR loans get tricky on the Grand Strand
Let us help with your next investment.
Send us an address you are looking at, or have us send you an investment property for sale. We will run the rent, the expenses and the association documents before you write an offer, at no cost.
Call 854.333.2135Common questions
Frequently asked questions
What is a good DSCR for an investment property?
Most lenders want 1.10 to 1.25 or higher on a purchase. That means the rent covers the payment with room to spare. A 1.00 ratio breaks even. Our preferred lender starts writing DSCR loans at a 0.75 ratio. Below 1.00, BrickWood Mortgage still finances the deal, with a larger down payment and a higher rate.
Can I get a DSCR loan in South Carolina with no income verification?
Yes. DSCR loans do not use personal income, tax returns, or debt-to-income ratios. The property's rent and the appraisal carry the application, which is the main reason investors choose them over conventional financing.
How much down payment does a DSCR loan require?
Expect 15 to 25 percent down on most Grand Strand DSCR loans, from the current BrickWood Mortgage investor programs. Condotels and non-warrantable condos ask for more, and a larger down payment improves both the rate and the qualifying ratio.
Can I use short-term rental income to qualify?
Sometimes. Some DSCR lenders accept short-term rental income. Around the Grand Strand, appraisers often provide high short-term rental income estimates, but only 75 percent of that figure can be counted as qualified income, so the number used to qualify is more conservative than the appraisal suggests. Long-term lease income is simpler to qualify on.
Can a DSCR loan close in an LLC?
Yes, and many investors prefer it. Closing in an LLC keeps a portfolio organized and supports partnerships, and a single-owner LLC does not break a 1031 exchange because the tax rules treat you and that LLC as the same taxpayer. Chapter3 coordinates the property and the loan together so the structure is right at closing.
Can I get a DSCR loan if the property does not cash flow?
Yes. BrickWood Mortgage writes DSCR loans down to a 0.75 ratio. That suits beach properties you buy for the appreciation, where the rent does not fully cover the payment. Expect a larger down payment and a higher rate. Above 1.00, the program asks for a standard investor down payment.