Arkansas DSCR Loans for STR Financing

Grow Your Portfolio with DSCR Loans

Whether you're purchasing duplexes in Little Rock, STRs in Hot Springs, or long-term rentals in Fayetteville, our DSCR loans  offer the flexibility and competitive terms Arkansas real estate investors need to grow. Designed for those who prefer asset-based financing, DSCR loans use property income — not personal earnings — as the key qualifier. We assess your property's ability to cash flow and service the loan, making the process smoother for investors.

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How to qualify

To obtain a quote, we will need the following information:

Property Value and

 Purchase Price


Down Payment

Amount


Credit Score



 Asset Types

  • Single Family Homes
  • Townhomes
  • Condos
  • 2 - 4 Units (Duplex, Triplex, Quadplex)
  • Multi-Family: 5 - 8 Units
  • Mixed-Use: 2 - 8 Units
  • Multi-Family: 9+ Unit



Loan Terms


  • Loan Sizes: $100k up to $3.5 Million (Larger loan sizes available on a case by case basis)
  • Purchase LTV: Up to 85%
  • Rate & Term Refinance LTV: Up to 80% 
  • Cash Out Refinance LTV: Up to 80%
  • Amortization: 30 Year % 40 Year Amortization Options Available
  • Term Lengths: 5/6 ARMs, 7/6 ARMs, 10 Year Interest Only, 30 Year Fixed & 40 Year Fixed
  • Floor Rate: 5.50% (subject to change daily due to market volatility)
  • Full Recourse with personal guarantee required for all borrowers with majority ownership (typically 20%+ or 25%+ if closing in an Entity)
  • DSCR Requirement: 1.00x or greater depending on loan size and property type. Sub-1.00x DSCR and NO DSCR options available.
  • Vesting: Lending to Individuals, LLCs, and Corporations. Trusts Allowable on a Case by Case Basis.
  • Average Time to Close: 14 to 35 days

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Frequently Asked Questions

What is a DSCR loan and how does it work for Arkansas real estate investors?

A DSCR loan (Debt Service Coverage Ratio loan) is a real estate financing tool that allows borrowers to qualify based on a property's rental income rather than personal income, employment history, or tax documents. Lenders determine eligibility by checking whether the property generates enough monthly cash flow to cover the mortgage and other debt obligations. This method is especially useful for investors with strong assets but complex financials. In Arkansas markets like Little Rock, Hot Springs, and Fayetteville, DSCR loans are a practical solution for acquiring STRs or expanding long-term rental portfolios without traditional loan barriers.

How is DSCR calculated in a typical loan scenario for Arkansas investors?

In Arkansas, DSCR is calculated by dividing a property's net operating income (NOI) by the annual debt service, which includes principal, interest, taxes, and insurance. For instance, if an Arkansas rental property brings in $96,000 in NOI and the debt service is $80,000, the DSCR would be 1.20. A DSCR of 1.00 is generally the minimum lenders require in Arkansas, though stronger ratios improve approval chances. Whether you're investing in Little Rock, Fayetteville, or smaller Arkansas towns, knowing how DSCR is calculated helps you choose properties with solid cash flow that qualify for favorable financing.

What is considered a good DSCR ratio when applying for financing?

In Arkansas, lenders generally consider a DSCR of 1.20 or higher to be solid. While 1.00 may be the technical minimum for approval, a stronger DSCR shows that the property produces healthy cash flow. A 1.20 DSCR in Arkansas increases the chances of favorable loan terms, like reduced interest rates or lower reserves. Whether you're investing in Little Rock, Fayetteville, or smaller rental markets, understanding DSCR benchmarks in Arkansas allows you to target better-performing assets and expand your portfolio with confidence.

Can I qualify for a DSCR loan if my personal income is limited?

Yes, you can qualify for a DSCR loan even if your personal income is limited. DSCR loans, often referred to as Airbnb loans when used for short-term rental properties, are designed to approve borrowers based on the income the property generates—not personal W-2s, tax returns, or debt-to-income ratios. Lenders calculate the property's debt service coverage ratio to determine if the income is sufficient to support the loan. As long as the DSCR meets the required threshold—usually 1.00 or higher—you can often be approved regardless of personal income. This makes Airbnb loans ideal for self-employed investors, business owners, or anyone scaling a rental portfolio without relying on traditional underwriting standards.

How does a lender evaluate rental income when approving a DSCR loan?

Lenders in Arkansas evaluate rental income for DSCR loans based solely on the property’s income, not the borrower’s. In Arkansas, this often involves reviewing lease agreements, market rent analysis, or Airbnb statements to determine net operating income. That figure is then divided by the expected loan costs to calculate the DSCR. If the DSCR meets or exceeds 1.00, most Arkansas lenders will consider the loan, even without W-2s or tax returns. DSCR loans in Arkansas are perfect for investors focused on portfolio growth. Knowing how lenders assess rental income in Arkansas is key to structuring successful deals.

What’s the minimum debt service coverage ratio required for approval?

Most DSCR lenders in Arkansas require a minimum ratio of 1.00, meaning the property’s income must fully support the loan’s debt service. Some lenders in Arkansas may allow DSCRs as low as 0.75 for experienced investors with strong equity or cash reserves. However, a DSCR of 1.20 or higher is ideal in Arkansas to access better interest rates and reduced reserve requirements. DSCR loans in Arkansas are commonly used for long-term rental properties in markets like Little Rock, Fayetteville, and Hot Springs. Investors in Arkansas benefit from a financing model that emphasizes property performance over personal income. Understanding the minimum DSCR thresholds in Arkansas allows borrowers to plan ahead and improve their odds of loan approval.

Who should consider using a DSCR instead of a traditional loan?

These loans are perfect for self-employed individuals, LLCs, and investors managing multiple properties. In Arkansas, DSCR loans give investors the ability to qualify using rental income alone, removing the need for W-2s or tax returns. Whether you're targeting multifamily units in Little Rock or STRs in Fayetteville, Arkansas borrowers benefit from faster closings and streamlined underwriting through this property-based financing model.

Expanding your rental portfolio beyond Arkansas? We also offer financing in Missouri and Mississippi , making it easy to scale across the South with the same asset-based approval process.