DSCR Loans in Memphis, TN
Loan-size math and qualifying analysis for DSCR financing on Memphis's $147k median home value. Moderate fit.
Moderate fit for Memphis.
DSCR pencils at 1.20 on Memphis medians — clears the 1.10 minimum for most lenders but won't get the best rate tier. Look for properties below median for stronger qualifying.
Payment on Memphis's $147k median.
| Median home value (Memphis) | $147,306 |
| Assumed LTV | 78% |
| Loan amount | $114,899 |
| Cash to close (down payment) | $32,407 |
| Assumed rate | 8.50% |
| Term | 30-year amortizing |
| Monthly P&I | $883/mo |
Does Memphis pencil?
| Median monthly rent (Memphis) | $1,256/mo |
| Property taxes (est. 1.1%/yr) | −$135/mo |
| Insurance (est. 0.5%/yr) | −$61/mo |
| NOI (before debt) | $1,060/mo |
| Debt service | −$883/mo |
| DSCR | 1.20 |
Most DSCR lenders require DSCR ≥ 1.10 to fund and ≥ 1.20-1.25 for the best pricing tier. Memphis medians clear the funding minimum but not the best-rate tier — look for properties below median or with above-market rent.
DSCR financing — the mechanics.
A non-QM mortgage product where the lender computes Debt Service Coverage Ratio = NOI ÷ debt service. If DSCR clears their threshold (1.10-1.25 typical), the loan funds regardless of the borrower's W-2 income, DTI, or tax returns. The property qualifies the loan.
Lender requires: 660+ FICO (most), 25% down (typical), 6 months of debt-service reserves, signed lease or projected market rent supported by Form 1007 appraiser-rent comps. Closing in 21-35 days standard.
How Tennessee law affects this loan.
Tennessee foreclosure timeline: non-judicial, ~60 days. See full DSCR in Tennessee breakdown.
Frequently asked.
What's the typical DSCR loan size for a property in Memphis?
On Memphis's $147k median home value, a DSCR loan at the standard 78% LTV would be approximately $115k, requiring $32k down.
What's the monthly payment on a typical DSCR loan in Memphis?
Fully-amortizing 30-year payment on a $115k DSCR loan at the typical rate of 8.50% would be approximately $883/month, excluding taxes and insurance.
Is Memphis a good market for DSCR financing?
DSCR pencils at 1.20 on Memphis medians — clears the 1.10 minimum for most lenders but won't get the best rate tier. Look for properties below median for stronger qualifying.
What credit and reserves do DSCR lenders require for Memphis properties?
Lender requires: 660+ FICO (most), 25% down (typical), 6 months of debt-service reserves, signed lease or projected market rent supported by Form 1007 appraiser-rent comps. Closing in 21-35 days standard.
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